/raid1/www/Hosts/bankrupt/CAR_Public/100909.mbx
C L A S S A C T I O N R E P O R T E R
Thursday, September 9, 2010, Vol. 12, No. 178
Headlines
ABM INDUSTRIES: Defends Consolidated "Diaz" Suit in Los Angeles
ABM INDUSTRIES: Faces "Khandera" Lawsuit Over Unpaid Overtime
ABM INDUSTRIES: Continues to Defend "Batiz" Suit in California
ABM INDUSTRIES: Unit Continues to Defend "Augustus" Litigation
ABM INDUSTRIES: Defends "Bucio" Suit Over Unpaid Overtime
AFFINIA GROUP: Discovery Ongoing in "S&E Quick" Suit
AON CORP: Enters MOU to Settle Suits Over Planned Hewitt Merger
CAPITAL ONE: COBNA & COSI Face 8 Suits Over Marketing Practices
CAPITAL ONE: Inks Initial Settlement in "Spinelli" Suit
CAPITAL ONE: Dismissal of "Rubio" Breach of Contract Claim Upheld
CBIZ INC: Faces Class Suit Related to Mortgage Ltd.'s Bankruptcy
CHARLES SCHWAB: Sued for Deviating From Investment Objectives
CHARLIE CRIST: Campaign Contributors Seek Class Certification
CITIBANK NA: Sued for Breaching Terms of Promissory Note
CITIMORTGAGE INC: Ala. Bankr. Court Denies Demand for Jury Trial
CHESAPEAKE ENERGY: Court Denies Plea to Strike Complaint Passages
CHILDREN'S PLACE: September 16 Hearing Set for Ruggiero Pact
CONVERTED ORGANICS: Jury Trial in "Leeseberg" Suit Set for May 17
COOPER COMPANIES: Court Gives Preliminary OK to $27MM Settlement
COWEN GROUP: Answer to Consolidated Complaint Due September 14
DE BEERS: 3rd Circuit Orders Re-Hearing of Class Suit Settlement
DENBURY RESOURCES: Hearing on Israni & Scott Deal Set for Oct.
ENERGYSOLUTIONS INC: Faces Updated Allegations in Class Suit
FINANCIAL PARTNERS: Credit Union Settles ATM Fee Case for $28,000
FIRST AMERICAN: Unit Wins as Bid for Class Certification Fails
H&R BLOCK: Appeal of Decertification in "Basile" Suit Pending
H&R BLOCK: Awaits Ruling on Certification Motion in "Marshall"
H&R BLOCK: Continues to Defend "Soliz" Suit in Texas
H&R BLOCK: RSM Defends Do Right's Suit in California
H&R BLOCK: Continues to Defend Several Wage and Hour Lawsuits
HEWITT ASSOCIATES: Has MOU to Settle Suits Over Aon Merger
KKR & CO: Shareholders' Plea to Proceed With Discovery Pending
KKR & CO: Oral Argument in Charter Litigation Postponed
MATRIXX INITIATIVES: Court Denies Settlement of Zicam Class Suits
MEMC ELECTRONIC: Appeal on Dismissal of Patel Suit Ongoing
MEMC ELECTRONIC: Motion to Dismiss "Jones" Suit Still Pending
MERGE HEALTHCARE: Awaits Ruling on Progress' $5MM Fee Petition
PENN NATIONAL: Arguments on Shareholders Suit Appeal Set for Oct.
PROSPER MARKETPLACE: Loan Note Purchasers' Class Suit Ongoing
REACHLOCAL INC: Wage & Hour Violations Suit Pending in Calif.
T-MOBILE: Kennett City Officials Say Suit Settlement Is Near
VERIFONE SYSTEMS: Motion to Dismiss Securities Suit Pending
VERIFONE SYSTEMS: Israel Suit Remains Stayed
WAL-MART STORES: Plaintiffs' Response on Review Motion Due Oct. 25
*********
ABM INDUSTRIES: Defends Consolidated "Diaz" Suit in Los Angeles
---------------------------------------------------------------
ABM Industries, Inc., continues to defend in the consolidated
cases of Diaz/Morales/Reyes v. Ampco System Parking. The cases
were filed on Dec. 5, 2006, in the L.A. Superior Court.
The named plaintiffs are current or former employees of ABM
subsidiaries who allege, among other things, that they were
required to work "off the clock," were not paid for all overtime,
were not provided work breaks or other benefits, and received pay
stubs not conforming to California law. The plaintiffs seek
unspecified monetary damages, injunctive relief or both.
No further updates were reported in the company's Sept. 3, 2010,
Form 10-Q filing with the U.S. Securities and Exchange Commission
for the quarter ended July 31, 2010.
ABM Industries, Inc. -- http://www.abm.com/-- is a facility
services contractor in the U.S. ABM and its subsidiaries provide
janitorial, parking, security, engineering and lighting services
for commercial, industrial, institutional and retail facilities in
hundreds of cities throughout the U.S. and in British Columbia,
Canada. The company operates through five segments: Janitorial,
Parking, Security, Engineering and Lighting.
ABM INDUSTRIES: Faces "Khandera" Lawsuit Over Unpaid Overtime
-------------------------------------------------------------
ABM Industries, Inc., continues to defend in a purported class
action suit, Khadera v. American Building Maintenance Co.-West and
ABM Industries. The suit, filed on March 24, 2008, in U.S
District Court of Washington, Western District, relates to alleged
violations of federal or state wage-and-hour laws.
The named plaintiffs are current or former employees of ABM
subsidiaries who allege, among other things, that they were
required to work "off the clock," were not paid for all overtime,
were not provided work breaks or other benefits, and received pay
stubs not conforming to California law. The plaintiffs seek
unspecified monetary damages, injunctive relief or both.
No further updates were reported in the company's Sept. 3, 2010,
Form 10-Q filing with the U.S. Securities and Exchange Commission
for the quarter ended July 31, 2010.
ABM Industries, Inc. -- http://www.abm.com/-- is a facility
services contractor in the U.S. ABM and its subsidiaries provide
janitorial, parking, security, engineering and lighting services
for commercial, industrial, institutional and retail facilities in
hundreds of cities throughout the U.S. and in British Columbia,
Canada. The company operates through five segments: Janitorial,
Parking, Security, Engineering and Lighting.
ABM INDUSTRIES: Continues to Defend "Batiz" Suit in California
--------------------------------------------------------------
ABM Industries, Inc., continues to defend in a purported class
action, Batiz/Heine v. American Commercial Security Services. The
consolidated suit was filed on June 7, 2006, in the U.S. District
Court of California, Central District.
The named plaintiffs are current or former employees of ABM
subsidiaries who allege, among other things, that they were
required to work "off the clock," were not paid for all overtime,
were not provided work breaks or other benefits, and received pay
stubs not conforming to California law. The plaintiffs seek
unspecified monetary damages, injunctive relief or both.
No further updates were reported in the company's Sept. 3, 2010,
Form 10-Q filing with the U.S. Securities and Exchange Commission
for the quarter ended July 31, 2010.
ABM Industries, Inc. -- http://www.abm.com/-- is a facility
services contractor in the U.S. ABM and its subsidiaries provide
janitorial, parking, security, engineering and lighting services
for commercial, industrial, institutional and retail facilities in
hundreds of cities throughout the U.S. and in British Columbia,
Canada. The company operates through five segments: Janitorial,
Parking, Security, Engineering and Lighting.
ABM INDUSTRIES: Unit Continues to Defend "Augustus" Litigation
--------------------------------------------------------------
A subsidiary of ABM Industries, Inc., continues to defend in a
class action suit captioned Augustus, Hall and Davis v. American
Commercial Security Services. The consolidated cases were filed
on July 12, 2005, before the Superior Court of California, Los
Angeles County.
The named plaintiffs are current or former employees of ABM
subsidiaries who allege, among other things, that they were
required to work "off the clock," were not paid for all overtime,
were not provided work breaks or other benefits, and received pay
stubs not conforming to California law. The plaintiffs seek
unspecified monetary damages, injunctive relief or both.
No further updates were reported in the company's Sept. 3, 2010,
Form 10-Q filing with the U.S. Securities and Exchange Commission
for the quarter ended July 31, 2010.
ABM Industries, Inc. -- http://www.abm.com/-- is a facility
services contractor in the U.S. ABM and its subsidiaries provide
janitorial, parking, security, engineering and lighting services
for commercial, industrial, institutional and retail facilities in
hundreds of cities throughout the U.S. and in British Columbia,
Canada. The company operates through five segments: Janitorial,
Parking, Security, Engineering and Lighting.
ABM INDUSTRIES: Defends "Bucio" Suit Over Unpaid Overtime
---------------------------------------------------------
ABM Industries, Inc., continues to defend in a purported class
action suit, Bucio and Martinez v. ABM Janitorial Services. The
consolidated suit was filed on April 7, 2006, before the Superior
Court of California, County of San Francisco.
The named plaintiffs are current or former employees of ABM
subsidiaries who allege, among other things, that they were
required to work "off the clock," were not paid for all overtime,
were not provided work breaks or other benefits, and received pay
stubs not conforming to California law. The plaintiffs seek
unspecified monetary damages, injunctive relief or both.
No further updates were reported in the company's Sept. 3, 2010,
Form 10-Q filing with the U.S. Securities and Exchange Commission
for the quarter ended July 31, 2010.
ABM Industries, Inc. -- http://www.abm.com/-- is a facility
services contractor in the U.S. ABM and its subsidiaries provide
janitorial, parking, security, engineering and lighting services
for commercial, industrial, institutional and retail facilities in
hundreds of cities throughout the U.S. and in British Columbia,
Canada. The company operates through five segments: Janitorial,
Parking, Security, Engineering and Lighting.
AFFINIA GROUP: Discovery Ongoing in "S&E Quick" Suit
----------------------------------------------------
Affinia Group Intermediate Holdings Inc. said in its Form 10-Q for
the quarter ended June 30, 2010, filed with the U.S. Securities
and Exchange Commission that discovery is ongoing in the class
action lawsuit filed by S&E Quick Lube Distributors, Inc. of Utah.
On March 31, 2008, a class action lawsuit was filed by S&E Quick
Lube Distributors, Inc. of Utah against several auto parts
manufacturers for allegedly conspiring to fix prices for
replacement oil, air, fuel and transmission filters. Several auto
parts companies are named as defendants, including Champion
Laboratories, Inc., Purolator Filters NA LLC, Honeywell
International Inc., Cummins Filtration Inc., Donaldson Company,
Baldwin Filters Inc., Bosch USA., Mann + Hummel USA Inc.,
ArvinMeritor Inc., United Components Inc and Wix Filtration Corp
LLC, one of Affinia Group's subsidiaries.
The lawsuit is currently pending as a consolidated Multi-District
Litigation Proceeding in Chicago because of multiple "tag-along"
filings in several jurisdictions. Two suits have also been filed
in the Canadian provinces of Ontario and Quebec. Wix, along with
other named defendants, have filed various motions to dismiss
plaintiffs' complaints, which were denied by the court in December
2009. Several defendants, including Wix, have refiled motions to
dismiss based upon plaintiff's most recent amended complaint.
Briefing on these motions is complete and the court is set to rule
on the motions in September.
Discovery is on-going and most recently, despite the U.S.
Department of Justice closing its investigation in this matter,
the State of Washington Attorney General has issued Civil
Investigative Demands to all defendants. Affinia believes that
Wix did not have significant sales in this particular market at
the relevant time periods so the company does not expect the
lawsuit to have a material adverse effect on its financial
condition or results of operations.
About Affinia Group
Affinia Group Intermediate Holdings Inc. --
http://www.affiniagroup.com/-- operates in the on- and off-
highway replacement products and services industry. Affinia
Group Inc. is a wholly owned subsidiary of the company. The
Company offers primarily three types of products: brake products,
which include brake drums, rotors, pads and shoes and hydraulic
brake system components; filtration products, which include oil,
fuel, air and other filters, and chassis products, which include
steering, suspension and driveline components. The company's
products are primarily sold in North America, Europe and South
America. During the year ended December 31, 2008, North America
accounted for 63% of net sales; Europe, 18% and South America,
19%. The company's customers primarily comprise aftermarket
distributors and retailers selling to professional technicians or
installers. On Oct. 31, 2008, Affinia Acquisition LLC completed
the purchase of 85% interests in HBM Investment Limited (HBM).
AON CORP: Enters MOU to Settle Suits Over Planned Hewitt Merger
---------------------------------------------------------------
Aon Corporation has entered into a memorandum of understanding to
settle putative class actions arising out of its planned merger
with Hewitt Associates, Inc., according to the company's Sept. 3,
2010, Form 8-K filing with the U.S. Securities and Exchange
Commission.
On July 11, 2010, Aon entered into an Agreement and Plan of Merger
with Hewitt, pursuant to which Hewitt agreed to merge with a
wholly owned subsidiary of Aon. On Aug. 17, 2010, Aon filed with
the SEC a definitive Joint Proxy Statement/Prospectus of Hewitt
and Aon in connection with the proposed Merger.
Following the announcement of the Merger Agreement, four putative
class action complaints were filed against Hewitt, the Hewitt
board of directors, Aon, and/or Alps Merger LLC in Delaware
Chancery Court, the U.S. District Court for the Northern District
of Illinois and in Cook County, Illinois Chancery Court and a
fifth suit was also filed against Hewitt and the Hewitt board of
directors in the Circuit Court of the Nineteenth Judicial Circuit
in Lake County, Illinois but did not name Aon. These complaints
alleged generally that the Hewitt defendants breached their
fiduciary duties, and that the Aon defendants aided and abetted
the Hewitt defendants' breaches of fiduciary duties, in connection
with the Merger by, among other things, negotiating the
transaction for what plaintiffs claimed to be inadequate
consideration and pursuant to what plaintiffs claimed to be an
inadequate process. The relief sought by the various Actions
included, among other things, enjoining the proposed Merger, or,
to the extent the Merger had already been implemented, rescinding
it and/or directing defendants to account for damages sustained by
the putative class.
On Aug. 12, 2010, plaintiffs in the two Cook County, Illinois
Chancery Court actions filed a motion for consolidation
(subsequently corrected on Aug. 13, 2010) which was granted on
Aug. 19, 2010. Plaintiffs in the remaining three actions
voluntarily agreed to conduct a single preliminary injunction
proceeding in the consolidated Cook County action with all
plaintiffs participating and proceeding with expedited discovery
in a coordinated fashion.
Subsequently, Aon, the other defendants in the Actions, and the
plaintiffs entered into a memorandum of understanding dated as of
Sept. 3, 2010, regarding the settlement of the actions described
above. In connection with the settlement, the parties agreed that
Aon and Hewitt would make certain disclosures to their
stockholders relating to the proposed Merger, in addition to the
information contained in the Joint Proxy Statement/Prospectus.
The memorandum of understanding also contemplates that the parties
will seek to enter into and present to the Circuit Court of Cook
County, Illinois a stipulation of settlement. The stipulation of
settlement will be subject to customary conditions, including
Court approval.
Aon Corporation -- http://www.aon.com/-- is a leading global
provider of risk management services, insurance and reinsurance
brokerage, and human capital consulting. Through its more than
36,000 colleagues worldwide, Aon delivers distinctive client value
via innovative and effective risk management and workforce
productivity solutions. Aon's industry-leading global resources
and technical expertise are delivered locally through more than
500 offices in more than 120 countries. Named the world's best
broker by Euromoney magazine's 2008, 2009 and 2010 Insurance
Survey, Aon also ranked highest on Business Insurance's listing of
the world's largest insurance brokers based on commercial retail,
wholesale, reinsurance and personal lines brokerage revenues in
2008 and 2009. A.M. Best deemed Aon the number one insurance
broker based on brokerage revenues in 2007, 2008 and 2009, and Aon
was voted best insurance intermediary, best reinsurance
intermediary and best employee benefits consulting firm in 2007,
2008 and 2009 by the readers of Business Insurance.
CAPITAL ONE: COBNA & COSI Face 8 Suits Over Marketing Practices
---------------------------------------------------------------
Capital One Financial Corp. disclosed in its Form 10-Q filed with
the U.S. Securities and Exchange Commission for the quarter ended
June 30, 2010, that between January and April 2010, eight
substantially similar putative class actions were filed against
its units, Capital One National Association and Capital One
Services, LLC, challenging various marketing practices relating to
the payment protection product:
-- Blackie v. Capital One Bank, et al. (United States District
Court for the Eastern District of Pennsylvania);
-- Carr v. Capital One Bank, et al. (United States District
Court for the District of New Jersey);
-- McCoy v. Capital One Bank, et al. (United States District
Court for the Southern District of California);
-- Mitchell v. Capital One Bank, et al. (United States
District Court for the Central District of California);
-- Salazar v. Capital One Bank, et al. (United States District
Court for the District of South Carolina);
-- Smith v. Capital One Bank, et al. (United States District
Court for the District of Arkansas);
-- Sullivan v. Capital One Bank, et al, (United States
District Court for the District of Connecticut);
-- Watlington v. Capital One Bank, et al. (United States
District Court for the Middle District of North Carolina).
The Payment Protection Class Actions seek a range of remedies,
including compensatory damages, punitive damages, restitution,
disgorgement, injunctive relief, and attorneys' fees. Each of
these cases is in early stages.
About Capital One
Capital One Financial Corporation -- http://www.capitalone.com/
-- is a diversified financial services company, whose banking and
non-banking subsidiaries market a variety of financial products
and services. Capital One, National Association (CONA), which
offers a range of banking products and financial services to
consumers, small businesses and commercial clients. The company
operates in three segments: Credit Card, Commercial Banking and
Consumer Banking. The company's principal subsidiaries include
Capital One Bank, (USA), National Association (COBNA), which
offers credit and debit card products, other lending products and
deposit products.
CAPITAL ONE: Inks Initial Settlement in "Spinelli" Suit
-------------------------------------------------------
Capital One Financial Corp., in its Form 10-Q filed with the U.S.
Securities and Exchange Commission for the quarter ended June 30,
2010, said its units, Capital One National Association and Capital
One Services, LLC, entered into a preliminary global settlement
with the various putative class counsel in the payment protection
class actions.
In September 2009, the United States District Court for the Middle
District of Florida certified a statewide class action in Spinelli
v. Capital One Bank, et al. with respect to the marketing of the
payment protection product in Florida.
In May 2010, the United States Court of Appeals for the Eleventh
Circuit denied COBNA's and COSI's petition for interlocutory
review of the class certification order, allowing the case to
proceed toward the summary judgment stage. In May 2010, COBNA and
COSI entered into a preliminary global settlement with the various
putative class counsel in the Payment Protection Class Actions,
which settlement will not be effective until it is finalized by
the parties and approved through the appropriate judicial approval
processes.
Capital One said it has established litigation reserves in an
amount expected to cover the estimated costs of the preliminary
class action settlement, which the company does not believe is
material.
About Capital One
Capital One Financial Corporation -- http://www.capitalone.com/
-- is a diversified financial services company, whose banking and
non-banking subsidiaries market a variety of financial products
and services. Capital One, National Association (CONA), which
offers a range of banking products and financial services to
consumers, small businesses and commercial clients. The company
operates in three segments: Credit Card, Commercial Banking and
Consumer Banking. The company's principal subsidiaries include
Capital One Bank, (USA), National Association (COBNA), which
offers credit and debit card products, other lending products and
deposit products.
CAPITAL ONE: Dismissal of "Rubio" Breach of Contract Claim Upheld
-----------------------------------------------------------------
The U.S. Court of Appeals for the Ninth Circuit upheld the
dismissal of the breach of contract claim filed by the plaintiff
in Rubio v. Capital One Bank, et al., Capital One Financial Corp.
said in its Form 10-Q filed with the U.S. Securities and Exchange
Commission for the quarter ended June 30, 2010.
In July 2010, the Ninth Circuit reversed in part and upheld in
part an order issued by the United States District Court for the
Central District of California in the Rubio case.
The plaintiff in Rubio alleged in a putative class action filed in
2007 that COBNA breached its contractual obligations and violated
the Truth In Lending Act and California's Unfair Competition Law
when it raised interest rates on certain credit card accounts.
The District Court granted COBNA's motion to dismiss all claims as
a matter of law prior to any discovery.
On appeal, the Ninth Circuit reversed the District Court's
dismissal with respect to the TILA and UCL claims, remanding the
case back to the District Court for further proceedings. The
Ninth Circuit upheld the dismissal of the plaintiff's breach of
contract claim, finding that COBNA was contractually allowed to
increase interest rates.
About Capital One
Capital One Financial Corporation -- http://www.capitalone.com/
-- is a diversified financial services company, whose banking and
non-banking subsidiaries market a variety of financial products
and services. Capital One, National Association (CONA), which
offers a range of banking products and financial services to
consumers, small businesses and commercial clients. The company
operates in three segments: Credit Card, Commercial Banking and
Consumer Banking. The company's principal subsidiaries include
Capital One Bank, (USA), National Association (COBNA), which
offers credit and debit card products, other lending products and
deposit products.
CBIZ INC: Faces Class Suit Related to Mortgage Ltd.'s Bankruptcy
----------------------------------------------------------------
CBiz Inc. said in its Form 10-Q filed with the U.S. Securities and
Exchange Commission for the quarter ended June 30, 2010, that it
is facing a handful of lawsuits related to Mortgage Ltd.'s
bankruptcy, one of which seeks to proceed as a class action.
In May 2010, June 2010 and July 2010, the Company and its
subsidiary, CBIZ MHM, LLC (fka CBIZ Accounting, Tax & Advisory
Services, LLC) were named as defendants in lawsuits filed in the
United States District Court for Arizona (Robert Facciola, et al.,
v. Greenberg Traurig LLP, et al.) and in the Superior Court for
Maricopa County Arizona (Victims Recovery, LLC v. Greenberg
Traurig LLP, et al., and Roger Eshkenazi, et al., v. Greenberg
Traurig LLP, et al.). The Facciola plaintiffs seek to proceed as
a class action.
Additionally, in November 2009, CBIZ MHM, LLC was named as a
defendant in the United States District Court for Arizona (Jeffery
C. Stone v. Greenberg Traurig LLP, et al.).
These matters arise out of the bankruptcy proceedings related to
Mortgages Ltd., a mortgage lender to developers in the Phoenix,
Arizona area. Various other professional firms not related to the
Company are also defendants in these lawsuits. The discovery and
motion phases of proceedings have commenced.
The plaintiffs, except for Stone, are all alleged to have directly
or indirectly invested in real estate mortgages through Mortgages
Ltd. The Facciola and Victims Recovery plaintiffs seek monetary
damages equivalent to the amounts of their investments. The
plaintiff in Stone seeks monies it allegedly lost based on the
claim that Mortgages Ltd. did not fund development projects in
which it was a contractor. The plaintiffs in these suits also seek
judgment interest, punitive damages and attorneys' fees.
Mortgages Ltd. had been audited by Mayer Hoffman McCann PC, a CPA
firm which has an administrative services agreement with CBIZ. The
claims against the CBIZ Parties seek to impose auditor-type
liabilities upon the Company for audits it did not conduct.
Specific claims include securities fraud, common law fraud,
negligent misrepresentation, Arizona Investment Management Act
violations, control-person liability, aiding and abetting and
conspiracy. CBIZ is not a CPA firm, does not provide audits, and
did not audit any of the entities at issue in these lawsuits.
The CBIZ Parties deny all allegations of wrongdoing made against
them in these actions and are vigorously defending the
proceedings. The Company has been advised by Mayer Hoffman McCann
PC that it denies all allegations of wrongdoing made against it
and that it intends to continue vigorously defending the matters.
Although the proceedings are subject to uncertainties inherent in
the litigation process and the ultimate disposition of these
proceedings is not presently determinable, management believes
that the allegations are without merit and that the ultimate
resolution of these matters will not have a material adverse
effect on the consolidated financial condition, results of
operations or cash flows of CBIZ.
About CBiz
CBIZ -- http://www.cbiz.com/-- is a provider of outsourced
business services to small and medium- sized companies throughout
the United States. As the largest benefits specialist, the ninth-
largest accounting company, and one of the ten largest valuation
and medical practice management companies in the United States,
CBIZ provides integrated services in the following areas:
accounting and tax; employee benefits; wealth management; property
and casualty insurance; payroll; IS consulting; and HR consulting.
CBIZ also provides valuation; litigation advisory; government
relations; commercial real estate advisory; wholesale life and
group insurance; healthcare consulting; medical practice
management; worksite marketing; and capital advisory services.
These services are provided throughout a network of more than 160
Company offices in 33 states and the District of Columbia.
CHARLES SCHWAB: Sued for Deviating From Investment Objectives
-------------------------------------------------------------
Jerry Smit, individually and on behalf of others similarly
situated v. Charles Schwab & Co., Inc., Schwab Investments and
Charles Schwab Investment Management, Inc., Case No. 10-cv-03971
(N.D. Calif. September 3, 2010), brings claims against the members
of the Charles Schwab financial services family for causing the
Schwab Total Bond Market Fund (an actively managed bond fund) to
deviate from its fundamental investment objective to track the
Lehman Brothers U.S. Aggregate Bond Index, exposing the Fund and
its shareholders of tens of millions of dollars in losses stemming
from a sustained decline in the value of non-agency mortgage-
backed securities. The Fund's deviation from its stated
investment objective caused investors to suffer a negative 12.64%
differential in total return for the Fund compared to the Index
for the period August 31, 2007, through February 27, 2009,
consisting of a negative total return of 4.80% for the Fund
compared to a positive total return of 7.85% for the Index over
the same period (including interest payments).
Additionally, the Complaint says that the defendants also
permitted the Fund to deviate from its fundamental no-
concentration policy precluding investment of more than 25% of the
Fund's total assets in non-agency mortgage-backed securities and
collateralized mortgaged obligations.
The non-agency CMOs were not part of the Index and were
substantially more risky than the U.S. Agency securities and other
instruments that comprised the Index.
By violating Section 13, the Complaint says defendants committed a
per se violation of the California Unfair Competition Law, Cal.
Bus. & Prof. Code Sections 17200, et seq.
Beginning in October 1998, and continuing through July 2010,
Plaintiff Jerry Smit, a resident of Arvada, Colorado, purchased
shares of the Fund, through both regular share purchases and
reinvestment of dividends. Mrs. Smit presently holds roughly
546.07 shares of the Fund.
Charles Schwab & Co., Inc. was, during the relevant time period,
the principal underwriter and distributor for shares of the Fund
and was defendant Schwab Investments' agent for the purpose of the
continuous offering of the Fund's shares. Schwab Investments, a
Massachusetts Business Trust, is the Registrant for the Total Bond
Market Fund, the issuer of Fund shares, and performed trust
services for the Fund. The Total Bond Market Fund is a series of
the Trust. Charles Schwab Investment Management oversees the
asset management and administration of the Fund. The defendants
are under the common control of The Charles Schwab Corp., a
publicly traded corporation.
The Plaintiff is represented by:
Reed R. Kathrein, Esq.
HAGENS BERMAN SOBOL SHAPIRO
715 Hearst Avenue, Suite 202
Berkeley, CA 94710
Telephone: (510) 725-3000
E-mail: reed@hbsslaw.com
peterb@hbsslaw.com
- and -
Steve W. Berman, Esq.
Sean R. Matt, Esq.
HAGENS BERMAN SOBOL SHAPIRO
1918 Eighth Avenue, Suite 3300
Seattle, WA 98101
Telephone: (206) 623-7929
E-mail: steve@hbsslaw.com
sean@hbsslaw.com
CHARLIE CRIST: Campaign Contributors Seek Class Certification
-------------------------------------------------------------
Aisling Swift at Naples Daily News reports two Republican campaign
contributors to Gov. Charlie Crist's U.S. Senate campaign filed a
motion Friday that asks a judge to certify their lawsuit as a
class-action complaint with more than 2,000 Republican donors.
Linda Morton, a Lely mother of four, and John Rood of
Jacksonville, a retired U.S. ambassador, argued that asking the
thousands who donated to Crist before he switched parties April 29
to individually sue in small claims court would defeat the class-
action rule's intent -- to reduce claims heard in court and
deliver justice no matter how small the claim.
The plaintiffs are represented by Rep. Tom Grady, R-Naples, who
resigned from Crist's campaign after he switched from Republican
to no party affiliation, and attorney David Shiner of Boca Raton.
Gov. Crist's attorney, Scott Weinstein of Fort Myers, said the
motion lacks merit and he plans to file a motion to dismiss the
lawsuit Aug. 31.
"It is an attempt by a few partisans to impose their views on
others who support the governor for a variety of reasons," Mr.
Weinstein said. "We will ask the court to dismiss all claims
leveled against the governor because he does not belong in this
case and we also will ask the judge to toss the remaining claims
against the campaign because no 'contract' was made or breached."
As far as class certification," he added, "the motion is a
desperate attempt to keep this matter in the press and distract
the governor and the voters."
Gov. Crist's prior attorney had filed a motion to dismiss in U.S.
District Court in Fort Myers, but that was moot after Mr. Grady
successfully transferred the lawsuit back to state court, where
he'd filed it on June 22, seeking compensation for unjust
enrichment, breach of contract, and other violations of state
laws. Gov. Crist's attorneys had argued it belonged in federal
court because it involved federal election laws, which say Gov.
Crist doesn't have to provide refunds unless he runs as a
Democrat.
"[Gov.] Crist's federal court detour caused almost two months'
delay, affecting plaintiffs and all class members' constitutional
rights in the upcoming election," says the 23-page motion filed
Friday in Collier Circuit Court.
It notes that unlike other cases, where it's hard to find affected
plaintiffs, it will be easy to find members of this class-action
case through Gov. Crist's campaign records. The motion argues
relief must be provided before the Nov. 2 election to prevent
further irreparable injury to the donors.
Ms. Morton contributed $500 to Gov. Crist's primary campaign,
while Mr. Rood donated the maximum for individual donors, $2,400
for the primary and $2,400 for the general election. The lawsuit
contends they donated to Gov. Crist, the Republican, so he
shouldn't use their money to oppose a Republican, former house
speaker Marco Rubio.
When Gov. Crist switched to run as an independent candidate, he'd
received roughly $10 million in donations and had spent $2.5
million, leaving $7.5 million, the amount they want refunded.
The motion is the latest since Senior Collier Circuit Judge Jack
Schoonover on Aug. 30 denied a motion to stop Gov. Crist from
using the funds. Mr. Schoonover said he'd let the plaintiffs
argue that again if they're certified as a class. No hearing date
has been set.
The polls, as of Friday, show Rubio has 40% of the vote, with Gov.
Crist trailing at 30% and Democratic nominee Kendrick Meek at 21%.
CITIBANK NA: Sued for Breaching Terms of Promissory Note
--------------------------------------------------------
Maplewood Properties, LLC, on behalf of itself and others
similarly situated v. Citibank, N.A., et al., Case No.
10-cv-03980 (N.D. Calif. September 3, 2010), accuses Citibank of
charging it interest when it gave less than 30-days written notice
of its intent to pay its entire unpaid principal balance of its
promissory note with the defendants, in breach of the terms of
Plaintiff's promissory note.
The Complaint says that paragraph 3.A. of its Fixed Rate
Promissory Note with 7 year Call Option (executed May 11, 2006
with defendants), "Borrower shall give Lender not less that (30)
days prior written notice (the 'Prepayment Notice') specifying the
amount of principal of this Note to be prepaid (the 'Prepayment
Date')." Additionally, when a borrower gives less than 30-days
written notice of the intent to pay defendants less than all of a
note's unpaid principal balance, borrower must pay defendants
interest on the number of days less than 30 for which borrower
failed to give notice.
But, the Plaintiff cites, the Note does not require a borrower to
make any interest payment when giving less than 30-days written
notice of its intent to pay a note's entire unpaid principal
balance.
On December 8, 2008, Plaintiff says it completed its sale of the
property covered by its Note and accordingly, paid defendants the
Note's entire $505,567.83 unpaid balance. Plaintiff gave
defendants less than 30 days notice of its intent to pay the
Note's entire balance. Defendants required Plaintiff to pay
interest of $2,633.17, invoking paragraph 3.A.'s 30-day notice
requirement for prepayment of less than the Notes entire unpaid
principal balance. Plaintiff relates that it paid this interest
to defendants, as the closing could not proceed unless this
interest was paid.
The Plaintiff is represented by:
Brad Yamauchi, Esq.
Derek G. Howard, Esq.
MINAMI TAMAKI, LLP
360 Post Street, 8th Floor
San Francisco, CA 94108-4903
Telephone: (415) 788-9000
E-mail: byamauchi@minamitamaki.com
dhoward@minamitamaki.com
- and -
Daniel R. Karon, Esq.
GOLDMAN SCARLATO & KARON, P.C.
700 W. St. Clair Avenue, Suite 204
Cleveland, OH 44113
Telephone: (216) 622-1851
E-mail: karon@gsk-law.com
- and -
Jeffrey A. Leon, Esq.
FREED & WEISS, LLC
111 West Washington Street, Suite 1331
Chicago, IL 60602
Telephone: (312) 220-0000
E-mail: jeff@freedweiss.com
- and -
Gregory A. Braun, Esq.
McCORMICK BRAUN FRIMAN LLC
2 N. LaSalle St., Suite 1250
Chicago, IL 60602
Telephone: (312) 327-3354
E-mail: gbraun@mbflegal.com
CITIMORTGAGE INC: Ala. Bankr. Court Denies Demand for Jury Trial
----------------------------------------------------------------
Plaintiffs Jacob Holman and Amye Holman filed their Chapter 13
bankruptcy petition February 8, 2007. Plaintiffs Gerald Garner
and Stacy Garner filed their Chapter 13 bankruptcy petition
August 27, 2004. Plaintiffs allege that in their bankruptcy
cases, Citimortgage, Inc., with the active participation and
consent of one or more of its attorneys, filed an improper and
fraudulent affidavit in support of its motion for relief from
stay. Essentially, the Plaintiffs' Amended Complaint alleges that
Defendant has made an institutional practice of filing false
affidavits in court in support of its Motions for Relief from the
Automatic Stay. The Amended Complaint further alleges that the
allegedly false affidavits submitted by the Defendant in the
Plaintiffs' cases are just two examples of a widespread practice
by the Defendant of filing improper affidavits. It is alleged that
this harms not only individual debtors, but also defiles the court
and prevents it from operating properly. Among others,
Plaintiffs, on behalf of themselves and other similarly situated,
seek all civil relief damages available to them and the class.
Citimortgage filed a Demand for Jury Trial. The Plaintiffs filed
a Motion to Strike Jury Demand. The Defendant objects to the
Plaintiffs' Motion to Strike.
The United States Bankruptcy Court for the Northern District of
Alabama, Western Division, granted the Plaintiffs' Motion to
Strike.
Bankruptcy Judge C. Michael Stilson points out that Rule 38 of the
Federal Rules of Civil Procedure preserves the right to a jury
trial, guaranteed by either the Seventh Amendment to the
Constitution of the United States or a federal statute. "Because
the Defendant does not assert that it is entitled to a jury trial
pursuant to a federal statute, the matter before the court rests
solely on whether the Defendant is entitled to a jury trial
pursuant to the Seventh Amendment to the United States
Constitution. Because the remedies sought by the Plaintiff in the
Amended Complaint are equitable in nature, this court finds that
the Defendant is not entitled to a jury trial pursuant to the
Seventh Amendment."
A copy of the court's memorandum of decision is available at:
http://www.leagle.com/unsecure/page.htm?shortname=inbco20100901599
CHESAPEAKE ENERGY: Court Denies Plea to Strike Complaint Passages
-----------------------------------------------------------------
Plaintiff United Food and Commercial Workers Union is the
designated lead Plaintiff in a putative class action suit alleging
that:
* Chesapeake Energy Corporation,
* Aubrey K. McClendon,
* Marcus C. Rowland,
* Michael A. Johnson,
* Richard K. Davison,
* Frank A. Keating,
* Breene M. Kerr,
* Charles T. Maxwell,
* Merrill A. Miller, Jr.,
* Donald L. Nickles, and
* Frederick B. Whittemore
* UBS Investment Bank,
* ABN Amro,
* Banc of America Securities LLC, and
* Wells Fargo Securities
violated the Securities Act of 1933 in connection with a July 9,
2008 secondary public offering of Chesapeake common stock, by
misstating and omitting material facts in connection with the
registration statement and prospectus, thereby rendering the
statement misleading to potential investors.
Defendants ask the United States District Court for the Western
District of Oklahoma to strike certain portions of the Plaintiff's
Amended Complaint should be stricken, contending that those
portions improperly expand the class definition to include
purchasers who lack standing to pursue claims.
In its response, Plaintiff does not disagree with Defendants'
statement regarding the purchasers who may properly be included in
the prospective class. Plaintiff agrees with Defendants that, to
have standing in the case, a purchaser must show that he purchased
shares pursuant to, or traceable to, the registration statement at
issue.
District Judge Timothy D. DeGiusti concludes that Defendants'
argument does not warrant striking the allegations at issue. By
asserting their arguments, Defendants have pointed out a concern
that may impact the determination of the members of a prospective
class, and they have submitted legal authority which is pertinent
to defining the members of a class that could be certified.
Plaintiff does not disagree with that authority or with the
standards governing the inclusion of purchasers in a prospective
class and the exclusion of those who lack standing. The Court
anticipates that these issues will be addressed by the parties, if
necessary, in connection with a proposed class certification.
However, Defendants' concerns regarding the possible
misinterpretation of the phrases included in the Amended Complaint
do not warrant striking the paragraphs in which they are
contained.
Thus, the Court denies the Motion to Strike.
A copy of the court's order is available at:
http://www.leagle.com/unsecure/page.htm?shortname=infdco20100902980
CHILDREN'S PLACE: September 16 Hearing Set for Ruggiero Pact
------------------------------------------------------------
A Sept 16, 2010, hearing has been scheduled to consider final
approval of the settlement in the suit filed by Meghan Ruggiero
against The Children's Place Services Company, LLC, according to
The Children's Place Retail Stores, Inc.'s Sept. 3, 2010, Form
10-Q filing with the U.S. Securities and Exchange Commission for
the quarter ended July 31, 2010.
On or about Sept. 28, 2007, Meghan Ruggiero filed a complaint
against the company and its subsidiary, Hoop Retail Stores, LLC,
in the U.S. District Court, Northern District of Ohio on behalf of
herself and other similarly situated individuals.
The lawsuit alleges violations of the Fair and Accurate Credit
Transactions Act and seeks class certification, an award of
statutory and punitive damages, attorneys' fees and costs, and
injunctive relief. The plaintiff filed an amended complaint on
Jan. 25, 2008.
Effective as of March 26, 2008, the prosecution of this lawsuit
against Hoop was stayed under the automatic stay provisions of the
U.S. Bankruptcy Code by reason of Hoop's petition for relief filed
that same day.
On March 2, 2009, the Court granted the plaintiff's motion to
dismiss the company as a defendant and to replace the company with
its subsidiary, The Children's Place Services Company, LLC. On
March 27, 2010 the plaintiff filed a second amended complaint.
On Oct. 8, 2009, the parties reached a tentative settlement in the
amount of $300,000, and the parties are negotiating the terms of
the settlement agreement. On Oct. 15, 2009, the parties filed a
joint notice of settlement, and the parties subsequently entered
into a settlement agreement.
On March 4, 2010, the Court preliminarily approved the settlement,
authorized the dissemination of notice of the settlement to the
company's shareholders and scheduled a hearing to consider the
fairness and final approval of the settlement. The parties
entered into an amendment to the settlement agreement on July 2,
2010, and the hearing on final approval of the amended settlement
is scheduled for Sept. 16, 2010.
The Children's Place Retail Stores, Inc. --
http://www.childrensplace.com/-- is a specialty retailer of
children's apparel and accessories, ages newborn to 14 years old.
The company designs, contract to manufacture and sells merchandise
under The Children's Place brand name. The company offers current
fashion trends in a color palette as coordinated outfits
specifically designed for children.
CONVERTED ORGANICS: Jury Trial in "Leeseberg" Suit Set for May 17
-----------------------------------------------------------------
Converted Organics Inc. said in its Form 10-Q for the quarter
ended June 30, 2010, filed with the U.S. Securities and Exchange
Commission that jury trial in the class action lawsuit filed by
Gerald S. Leeseberg is scheduled for May 17, 2011.
On December 11, 2008, the Company received notice that a putative
class action lawsuit had been filed on behalf of 59 persons or
entities that purchased units pursuant to a financing terms
agreement, or FTA, dated April 11, 2006, captioned Gerald S.
Leeseberg, et al., v. Converted Organics, Inc., filed in the U.S.
District Court for the District of Delaware.
The lawsuit alleges breach of contract, conversion, unjust
enrichment, and breach of the implied covenant of good faith in
connection with the alleged failure to register certain securities
issued in the FTA, and the redemption of the Company's Class A
warrants in November 2008. The lawsuit seeks damages related to
the failure to register certain securities, including alleged late
fee payments, of approximately $5.25 million, and unspecified
damages related to the redemption of the Class A warrants.
In February 2009, the Company filed a Motion for Partial Dismissal
of Complaint. On October 7, 2009, the Court concluded that Mr.
Leeseberg has properly stated a claim for actual damages resulting
from the Company's alleged breach of contract, but that Mr.
Leeseberg has failed to state claims for conversion, unjust
enrichment and breach of the implied covenant of good faith, and
the Court dismissed such claims.
On November 6, 2009, the Company filed its answer to the Complaint
with the Court. On March 4, 2010, the parties participated in a
conference, and began discussing discovery issues.
Plaintiff filed a Motion for Class Certification on June 22, 2010,
which is pending before the District Court. A jury trial has been
set for May 17, 2011. The Company plans to vigorously defend this
matter and is unable to estimate any contingent losses that may or
may not be incurred as a result of this litigation and its
eventual disposition. Accordingly, no contingent loss has been
recorded related to this matter.
About Converted Organics
Converted Organics Inc. -- http://www.convertedorganics.com/--
operates processing facilities that use food waste as raw
material to manufacture all-natural soil amendment products
combining nutritional and disease suppression characteristics.
In addition to its sales in the agribusiness market, the company
sells and distributes its products in the turf management and
retail markets. As of Dec.31, 2008, the company operated two
facilities: Woodbridge facility and Gonzales facility. The
company derives revenue from two sources: tip fees and product
sales. Waste haulers pay the tip fees to the company for
accepting food waste generated by food distributors, such as
grocery stores, produce docks, fish markets and food processors,
and by hospitality venues, such as hotels, restaurants,
convention centers and airports. In March 2010, the company
acquired a line of poultry-based organic fertilizer products.
COOPER COMPANIES: Court Gives Preliminary OK to $27MM Settlement
----------------------------------------------------------------
The U.S. District Court for the Central District of California
gave its preliminary approval to the agreement settling a class
action against The Cooper Companies, Inc., for $27.0 million,
according to the company's Sept. 3, 2010, Form 10-Q filing with
the U.S. Securities and Exchange Commission for the quarter ended
July 31, 2010.
On Feb. 15, 2006, Alvin L. Levine filed a putative securities
class action lawsuit in the U.S. District Court for the Central
District of California, Case No. SACV-06-169 CJC, against the
company, A. Thomas Bender, its Chairman of the Board and a
director, Robert S. Weiss, its Chief Executive Officer and a
director, and John D. Fruth, a former director.
On May 19, 2006, the Court consolidated this action and two
related actions under the heading In re Cooper Companies, Inc.
Securities Litigation and selected a lead plaintiff and lead
counsel pursuant to the provisions of the Private Securities
Litigation Reform Act of 1995, 15 U.S.C. Section 78u-4.
The lead plaintiff filed a consolidated complaint on July 31,
2006. The consolidated complaint was filed on behalf of all
purchasers of the company's securities between July 28, 2004, and
Dec. 12, 2005, including persons who received company securities
in exchange for their shares of Ocular Sciences, Inc., in the
January 2005 merger pursuant to which the company acquired Ocular.
In addition to the company, Messrs. Bender, Weiss, and Fruth, the
consolidated complaint named as defendants several of the
company's other current officers and directors and former
officers. On July 13, 2007, the Court granted Cooper's motion to
dismiss the consolidated complaint and granted the lead plaintiff
leave to amend to attempt to state a valid claim.
On Aug. 9, 2007, the lead plaintiff filed an amended consolidated
complaint. In addition to the company, the amended consolidated
complaint names as defendants Messrs. Bender, Weiss, Fruth, Steven
M. Neil, the Company's former Executive Vice President and Chief
Financial Officer, and Gregory A. Fryling, CooperVision's former
President and Chief Operating Officer.
The amended consolidated complaint purports to allege violations
of Sections 10(b) and 20(a) of the Securities and Exchange Act of
1934 by, among other things, contending that the defendants made
misstatements concerning the Biomedics(R) product line, sales
force integration following the merger with Ocular, the impact of
silicone hydrogel lenses and financial projections. The amended
consolidated complaint also alleges that the company improperly
accounted for assets acquired in the Ocular merger by improperly
allocating $100 million of acquired customer relationships and
manufacturing technology to goodwill (which is not amortized
against earnings) instead of to intangible assets other than
goodwill (which are amortized against earnings), that the company
lacked appropriate internal controls and issued false and
misleading Sarbanes-Oxley Act certifications.
On Oct. 23, 2007, the Court granted in-part and denied in-part
Cooper and the individual defendants' motion to dismiss. The
Court dismissed the claims relating to the Sarbanes-Oxley Act
certifications, the company's financial projections and the
company's accounting of assets acquired in the Ocular merger.
The Court denied the motion as to the claims related to alleged
false statements concerning the Biomedics product line, sales
force integration and the impact of silicone hydrogel lenses.
On Nov. 28, 2007, the Court dismissed all claims against Mr.
Fruth.
On Dec. 3, 2007, the company and Messrs. Bender, Weiss, Neil and
Fryling answered the amended consolidated complaint. On April 8,
2008, the Court granted a motion by Mr. Neil for judgment on the
pleadings as to him. On Oct. 20, 2009, the Court reaffirmed that
the plaintiffs' financial projection claims had been dismissed in
its earlier rulings.
On Jan. 6, 2009, the Court granted the plaintiffs' motion for
class certification. The certified class consists of persons who
purchased or otherwise acquired Cooper common stock between July
28, 2004, and Nov. 21, 2005. Discovery in this matter has closed.
Cooper and the individual defendants filed summary judgment
motions on Dec. 21, 2009. On March 4, 2010, the Court denied in
substantial part the motions for summary judgment.
On May 4, 2010, the company announced that it has reached an
agreement in principle to settle the consolidated class action
lawsuit for $27.0 million.
The Court granted preliminary approval of the proposed settlement
on Aug. 16, 2010, and scheduled a hearing for final approval of
the proposed settlement on Dec. 13, 2010.
The company discloses that it has exhausted its insurance coverage
in defense of this litigation, and if the proposed settlement is
not approved by the Court and the case proceeds to trial, general
and administrative expenses will increase.
Headquartered in Pleasanton, California, The Cooper Companies,
Inc. -- http://www.coopercos.com/-- manufactures and markets
specialty healthcare products through its CooperVision and
CooperSurgical units. CooperVision, Inc., develops, manufactures
and markets a broad range of contact lenses for the worldwide
vision correction market. It has manufacturing facilities in
Juana Diaz, Puerto Rico; Norfolk, VA; Rochester, NY; Adelaide,
Australia; and Hamble and Hampshire, UK. CooperSurgical, Inc.
develops, manufactures and markets medical devices, diagnostic
products and surgical instruments and accessories used primarily
by gynecologists and obstetricians. Its major manufacturing and
distribution facilities are in Trumbull, CT, Pasadena, CA, and
Stafford, TX.
COWEN GROUP: Answer to Consolidated Complaint Due September 14
--------------------------------------------------------------
Cowen Group, Inc., said in its Form 10-Q for the quarter ended
June 30, 2010, filed with the U.S. Securities and Exchange
Commission that a state court has consolidated two putative class
actions related to CardioNet's March 2008 IPO.
On March 5, 2010, Cowen and Company was named as a defendant,
along with several other underwriters, in a putative class action
filed in the Superior Court of the State of California, County of
San Diego, in connection with an August 2008 follow-on offering
for CardioNet, Inc. The complaint alleges, among other things,
that the prospectuses for CardioNet's March 2008 IPO (in which
Cowen and Company did not participate) and subsequent follow-on
offering (in which Cowen and Company did participate) were false
and misleading and failed to disclose, among other things, that
CardioNet incorrectly reported revenue and failed to disclose
certain risks relating to Medicare reimbursement rates for
CardioNet's services.
On April 5, 2010, Cowen and Company and the other defendants moved
to remove the case to the United States District Court for the
Southern District of California and, on April 7, 2010, moved to
transfer the case to the United States District Court for the
Eastern District of Pennsylvania. On April 23, 2010, plaintiffs
moved to remand the case back to California state court. The
motions to transfer and remand remain pending.
On July 26, 2010, the court consolidated the two putative class
actions in which Cowen and Company was named as a defendant with
several related actions and appointed as lead plaintiffs the
Puerto Rico Government Employees and Judiciary Retirement Systems
Administration, Craig B. Laub, J.D. Pisut, and Sandra Redfern.
Lead plaintiffs must file a consolidated complaint by August 25,
2010 and defendants must answer, move, or otherwise respond to the
consolidated complaint by September 14, 2010.
About Cowen Group
Cowen Group, Inc. -- http://www.cowen.com/-- is an investment
bank that provides research, sales and trading, and investment
banking services to companies and institutional investor clients
in the healthcare, technology, media and telecommunications,
alternative energy and consumer sectors.
DE BEERS: 3rd Circuit Orders Re-Hearing of Class Suit Settlement
----------------------------------------------------------------
The Israeli Diamond Industry reports the New York Third Circuit
Court of Appeals has ordered a re-hearing of the settlement of the
De Beers diamond company class action law suit. The re-hearing
will take place before the entire Third Circuit panel, which will
be charged with deciding whether the lower court was correct in
certifying the suit as a class action.
The suit and the settlement agreement were challenged on a number
of grounds, including the lack of common harm to all members of
the class.
Now that the class action will be re-heard, all parties in the
suit will have a second chance to argue the designation of the
suit as a class action.
Should the appellants -- the parties challenging the settlement --
present persuasive arguments that the class was not correctly
composed, the settlement agreement would not be valid.
While the case is being re-heard and until a ruling is handed
down, none of the members of the action against the diamond
supplier will receive any settlement money.
The re-hearing process is not bound to any timetable, and the
Third Circuit Court's decision could be appealed to the Supreme
Court.
DENBURY RESOURCES: Hearing on Israni & Scott Deal Set for Oct.
-------------------------------------------------------------
A hearing to consider final approval of a settlement resolving two
class action lawsuits related to Denbury Resources, Inc.'s merger
with Encore Acquisition Company is set for October 21, 2010,
Denbury said in its Form 10-Q filed with the U.S. Securities and
Exchange Commission for the quarter ended June 30, 2010.
In connection with the Company's proposed acquisition of Encore,
three shareholder lawsuits styled as class actions have been filed
against Encore and its board of directors. The lawsuits are
entitled:
-- Sanjay Israni, Individually and On Behalf of All Others
Similarly Situated vs. Encore Acquisition Company et al.
(filed November 4, 2009 in the District Court of Tarrant
County, Texas),
-- Teamsters Allied Benefit Funds, Individually and On Behalf
of All Others Similarly Situated vs. Encore Acquisition
Company et al. (filed November 5, 2009 in the Court of
Chancery in the State of Delaware), and
-- Thomas W. Scott, Jr., individually and on behalf of all
others similarly situated v. Encore Acquisition Company et
al. (filed November 6, 2009 in the District Court of
Tarrant County, Texas).
The Teamsters and Scott lawsuits also name Denbury as a defendant.
The complaints generally allege that (1) Encore's directors
breached their fiduciary duties in negotiating and approving the
Merger and by administering a sale process that failed to maximize
shareholder value and (2) Encore, and, in the case of the
Teamsters and Scott complaints, Denbury aided and abetted Encore's
directors in breaching their fiduciary duties. The Teamsters
complaint also alleges that Encore's directors and executives
stand to receive substantial financial benefits if the transaction
is consummated on its current terms. The plaintiffs in these
lawsuits seek, among other things, to enjoin the Merger and to
rescind the Merger Agreement. Encore and Denbury have entered into
a Memorandum of Understanding with the plaintiffs in these
lawsuits agreeing in principle to the settlement of the lawsuits
based upon inclusion in the Company's joint proxy statement and
prospectus dated February 5, 2010, mailed to shareholders of
Denbury and Encore in connection with their respective shareholder
meetings to approve the Merger.
On March 9, 2010, Denbury acquired Encore Acquisition Company
pursuant to an Agreement and Plan of Merger entered into with
Encore on October 31, 2009.
On June 11, 2010, Judge Dana Womack, the presiding judge in the
Israni and Scott class action cases, granted the defendants'
motions striking the merger class action claims of the Harbor
Police Retirement System and Harbor Police efforts to intervene in
the Israni and Scott cases.
On August 5, 2010, Judge Womack preliminarily approved the
Stipulation of Settlement dated June 22, 2010, settling the Israni
and Scott cases, permitting Encore shareholders the right to opt-
out of the settlement, appointing representatives of the class and
their counsel, approving the notice of class action which must be
mailed to former Encore shareholders by August 26, 2010, and
setting a hearing on October 21, 2010 to consider final approval
of the settlement, certification of the class and dismissal of the
case with prejudice. The settlement amount agreed upon with the
Israni and Scott plaintiffs is immaterial to Denbury Resources,
the company said.
About Denbury Resources
Denbury Resources Inc. -- http://www.denbury.com/-- is engaged
in the acquisition, development, operation and exploration of oil
and natural gas properties in the Gulf Coast region of the United
States, primarily in Mississippi, Louisiana, Texas and Alabama.
The company is an independent oil and gas company engaged in
acquisition, development and exploration activities in the United
States Gulf Coast region. It is an oil and natural gas producer
in Mississippi, which owns a carbon dioxide (CO2) reserves east
of the Mississippi River used for tertiary oil recovery, and
holds a significant operating acreage in the Barnett Shale play
near Fort Worth, Texas, onshore Louisiana, Alabama, and
properties in Southeast Texas. In January 2010, the Company
announced the sale of its remaining 40% working interest in
Barnett Shale properties to Talon Oil & Gas LLC.
ENERGYSOLUTIONS INC: Faces Updated Allegations in Class Suit
------------------------------------------------------------
Judy Fahys at The Salt Lake Tribune reports August was a busy
month in the courts for EnergySolutions Inc., the Salt Lake City-
based nuclear waste company.
On Aug. 4, a class-action shareholder suit updated allegations
that company managers exaggerated key business prospects to pump
up the stock price just before investor-owners cashed out and the
stock plummeted.
Then on Aug. 26, Sanjay Israni of New Jersey filed a special
lawsuit, called a "shareholder derivative action," claiming that
officers and directors no longer were in a position to protect the
company and its shareholders from that mismanagement. After
officers allegedly "pimped" the stock and pocketed more than $1.2
billion, some current shareholders now want the money returned to
the company.
Also Aug. 26, a 3rd District judge in Salt Lake City rejected
EnergySolutions' request to throw out a 4-year-old antitrust suit
filed by the waste company's onetime president, Charles Judd. In
that case, allegations such as a shortage of radioactive waste-
disposal space and underpayment of taxes -- both issues of
community importance -- are on the line.
At the heart of all three suits is the charge that EnergySolutions
essentially slapped lipstick on a pig, helping company leaders
profit while harming others.
"Contrary to [EnergySolutions'] portrayal of the company's
business and prospects, facts that existed at the time of the
statements rendered many of [the company's] statements untrue and
misleading," says the class-action suit making its way through the
U.S. District Court in the Southern District of New York. The
original suit was filed last fall by the employee retirement fund
of the City of Roseville, Mich., and was later consolidated with
actions brought by the Building Trades United Pension Trust Fund
and the New England Carpenters Guaranteed Annuity and Pension
Fund.
In the face of the legal challenges, EnergySolutions is prepared
to fight the allegations, said Dale Didion, executive vice
president for government relations and communications. "None of
the claims have any merit. And we will defend [the company
against] the lawsuits vigorously," he said, without elaboration,
in an e-mail response.
EnergySolutions stock closed below $5 a share Friday, about one-
fifth the price the stock fetched in its November 2007 initial
public offering and one-quarter the price it drew in a secondary
offering the next summer.
With more than 5,000 employees and operations on three continents,
EnergySolutions has grown from a privately owned and operated
disposal site for low-level radioactive and hazardous waste in
Tooele County to a full-service nuclear waste services corporation
that did $1.6 billion in business around the world last year. The
company's founder and former CEO, Steve Creamer, and successor Val
J. Christensen are named as defendants in both suits, along with
others.
Plaintiffs in the shareholder lawsuits accuse the company's
leaders of touting business opportunities they knew would never
materialize or suspected to be unlikely. The company promoted its
life-of-plant contracts, even though the contracts were structured
in a way that actually drove away business, and managers told
company leaders so, the suits allege.
In addition, both shareholder suits claim, managers knew that a
nuclear site decommissioning and decontaminating service (D&D)
leaders were touting actually offered very little near-term
revenue for EnergySolutions, even though company officials
repeatedly said sales were just ahead. Company officials said by
taking over plant licenses for 13 reactor sites and tapping into
their federally mandated D&D funds, EnergySolutions could expect
up to $3.1 billion in business in coming years, the suit alleges.
Trouble was, say the lawsuits, the company knew that just one D&D
job was on the near-term horizon, that some companies had already
rejected the EnergySolutions proposal, that the company was not
able to handle more than one of these contracts at a time and,
that even if it landed several jobs, the D&D funds were
insufficient to do the work.
The lawsuits also say the company wasn't straight with investors
about its important large-components business. EnergySolutions,
they said, did not disclose how unlikely it would be for the U.S.
Nuclear Regulatory Commission to make a crucial change in a long-
standing policy, a policy that did not allow access to shutdown
funds until a reactor site was being closed for good.
Executives repeatedly told investors they were optimistic the
commission would support using trust funds for the large
components, the suits claim, even though they privately discussed
the rule change as being improbable.
In fact, says the retirement-fund suit, one executive bet another
that "he would run through the parking lot naked if the NRC
approved" EnergySolutions' request to change the policy.
Just weeks after EnergySolutions' secondary offering two years
ago, the NRC rejected the company's petition. The company would
have to apply to access the funds on a case-by-case basis.
EnergySolutions last week finalized its licensed stewardship
contract with the Zion Generating Station, two reactors that were
closed in 1998, about two years later than originally proposed.
The delay on the $1 billion job allowed the cleanup fund to
recover about $175 million from what EnergySolutions described at
the time as an economy-induced slump.
The Israni lawsuit, filed in the U.S District Court in Salt Lake
City, said members of the board of directors, as well as founder
and former CEO Creamer, should be held accountable for the
company's alleged misrepresentations. Mr. Israni, like the
plaintiffs in the consolidated class-action suit, requests a jury
trial.
"By their actions alleged herein," says the shareholder suit, "the
individual defendants, either directly or through aiding and
abetting, abandoned and abdicated their responsibilities and
fiduciary duties with regard to prudently managing the assets and
business of EnergySolutions in a manner consistent with the
operations of a publicly held corporation."
Misrepresentations are also alleged in the antitrust suit brought
by Mr. Judd, who today is the owner of a disposal firm called
Cedar Mountain Environmental and was a president of the
radioactive waste disposal company when it was called Envirocare.
This suit charges, among other things, that EnergySolutions has
over-promised the disposal space in its Tooele County landfill and
that the company has failed to pay its proper share of state
taxes.
In an odd side note, the waste company's former president, Mr.
Judd, signed up months ago for one of the disposal site tours the
company has touted in its recent marketing campaign.
Mr. Judd had ordered his box lunch and was waiting last week for
the shuttle to the site about 75 miles from the company's downtown
Salt Lake City headquarters, when he was told he would not be able
to take the tour.
"It was entirely inappropriate for Charles Judd, a litigant
against the company, to circumvent the rules of discovery by
attempting to join a tour of the Clive facility," said
EnergySolutions' Mr. Didion.
Mr. Judd was disappointed about not having an opportunity to see
the updated Tooele County site firsthand.
"If someone was questioning what they were saying -- they don't
want that to happen."
FINANCIAL PARTNERS: Credit Union Settles ATM Fee Case for $28,000
-----------------------------------------------------------------
FINANCIAL PARTNERS CREDIT UNION ATM
NOTICE OF CLASS ACTION SETTLEMENT
Zintel v. Financial Partners Credit Union, Case No. SAC09-0868
IF YOU USED THE FINANCIAL PARTNERS CREDIT UNION ATM REFERENCED IN
THE NEXT PARAGRAPH BETWEEN JULY 29, 2008, AND JULY 28, 2009, AND
WERE CHARGED A FEE FOR THE USE OF THAT ATM, YOU MAY BE A CLASS
MEMBER. THIS SETTLEMENT MAY AFFECT YOUR RIGHTS.
This Notice relates only to one (1) specific Financial Partners
Credit Union ATM, located at 140 Chapman Avenue, Suite A, Orange,
California, and concerns a lawsuit about charging of fees at this
ATM. Mrs. Zintel sued Financial Partners Credit Union under a law
called the Electronic Funds Transfer Act on the grounds that the
ATM did not have an externally posted fee notice.
Financial Partners Credit Union denies Mrs. Zintel's claims but
has agreed to a settlement of the case. The settlement includes
everyone who was charged a fee for using the ATM to access a
personal (not business) account between July 29, 2008 and July 28,
2009. These people are called "Class Members," and the time period
that is covered is called the "Class Period." Under the law, the
maximum that a group of people may recover in a case like this one
is the lesser of 1% of Financial Partners Credit Union's net worth
or $500,000, plus any actual damages that the class members
suffered. Financial Partners has stated that during the Class
Period, there were approximately 1048 transactions who were
charged ATM fees at the subject ATM(s) during the Class Period.
Financial Partners Credit Union has agreed to establish a
Settlement Fund of $28,000 to settle the case. Class Members may
make a claim on the Settlement Fund to receive a pro rata share,
up to a maximum of $100, so the attorneys believe that a
settlement allowing Class Members to make a claim for up to $100
is fair and reasonable. The Settlement Fund will also be used to
pay the costs of notifying Class Members of the Settlement and to
process their claims, the lawyers who filed the lawsuit their
reasonable attorney fee, not to exceed $9,000, and Mrs. Zintel
$1,000 for her services as the class representative.
On October 18th, 2010 at the United States District Court, Central
District of California, Southern Division, 411 West Fourth Street,
Santa Ana, CA 92701, Judge David O. Carter will hold a hearing to
decide whether to finally approve this settlement. YOU DO NOT NEED
TO ATTEND. If the settlement is approved, all Class Members will
be bound by the resting judgment and court orders, and eligible
Class Members will be entitled to claim benefits under the
settlement. You have three choices: (1) If you want to receive
your pro rata share of the Settlement Fund, up to a maximum of
$100.00, you must submit a completed Claim Form, postmarked by
October 14th, 2010 to the Settlement Administrator:
Law Offices of Michael T. Harrison
25876 The Old Road, #304
Stevenson Ranch, CA 91381
Failure to submit a Claim Form will mean you receive no money but
are still governed by a Release of your rights to sue Financial
Partners Credit Union for the ATM fee notice claims raised in this
Lawsuit. Download a Claim Form at http://www.morecaseinfo.com/or
call Class Counsel at (661) 257-2854 to request a Claim Form. (2)
If you do not want to participate in the Settlement and want to
retain any right you may have to pursue your claim separately, you
must write a letter stating "EXCLUDE ME FROM THE ZINTEL V.
FINANCIAL PARTNERS CREDIT UNION SETTLEMENT." Include your name and
address and mail the letter to the Settlement Administrator at Law
Offices of Michael T. Harrison, 25876 The Old Road, #304,
Stevenson Ranch, CA 91381. Your letter must be postmarked by
October 14, 2010 to be valid. (3) If you think the Settlement is
unfair, you may object to it by writing a memo stating the
specific reasons for your objection and filing it with the Court
at The United States District Court, Central District of
California, Southern Division, 411 West Fourth Street, Santa Ana,
CA 92701 on or before October 14, 2010 and sending a copy to Class
Counsel at 25876 The Old Road, #304, Stevenson Ranch, CA 91381 and
to counsel for Financial Partners Credit Union:
Colleen A. Deziel, Esq.
Anderson, McPharlin & Conners LLP
444 South Flower Street, 31st Floor
Los Angeles, CA 90071
For more information, visit http://www.morecaseinfo.com/or
contact Class Counsel Mike Harrison at (661) 257-2854.
DO NOT CONTACT THE COURT FOR INFORMATION AS IT WILL NOT BE ABLE TO
ASSIST YOU
FIRST AMERICAN: Unit Wins as Bid for Class Certification Fails
--------------------------------------------------------------
Andrew Longstreth, writing for The American Lawyer, reports a
financial services company has defeated class certification in a
Manhattan federal court lawsuit against it involving subprime
securities. The defendant, First American subsidiary eAppraiseIT,
conducted home appraisals in connection with Washington Mutual
mortgage loans. First American shareholders, led by the Berks
County, Pa. Employees' Retirement Fund, alleged that eAppraiseIT
routinely overvalued homes so WaMu could close mortgage deals.
The arrangement, according to the plaintiffs, allowed First
American to report inflated financial results.
When details of the arrangement began to emerge, via a New York
attorney general's suit against eAppraiseIT, among other
disclosures, the share price of First American dropped, according
to Berks County's complaint. But in a 15-page opinion last week,
Southern District of New York Judge Lewis A. Kaplan ruled that the
statements and omissions the plaintiffs challenged were not
material, and therefore class counsel from Grant & Eisenhofer
could not show that all potential class members relied on them.
Judge Kaplan noted, for instance, that First American's stock
price did not budge on the day the New York attorney general's
office filed its suit. "The fact that public disclosure of the
N.Y. AG's investigation and lawsuit had no significant effect on
the price of First American stock is not surprising," he wrote in
Berks County Employees' Retirement Fund v. First American Corp.,
08-cv-5654. "eAppraiseIT was only one of First American's
approximately 450 subsidiaries. The $50 million in revenue that
eAppraiseIT derived from its relationship with WaMu in 2006 and
2007 represented only 0.3 percent of First American's total
revenue in those years."
Berks County counsel James Sabella of Grant & Eisenhofer called
Judge Kaplan's decision "unfortunate," adding that the conduct at
issue in the case played a key role in the financial crisis. He
said no decision about a possible appeal had been made.
First American is represented by Robert Serio, Esq., of Gibson,
Dunn & Crutcher.
H&R BLOCK: Appeal of Decertification in "Basile" Suit Pending
-------------------------------------------------------------
The appeal on the decertification in the matter Sandra J. Basile,
et al. v. H&R Block, Inc., et al., remains pending.
H&R Block, Inc., has been named in multiple lawsuits as defendants
in litigation regarding its refund anticipation loan program in
past years. All of those lawsuits have been settled or otherwise
resolved, except for one. The sole remaining case is a putative
class action styled Sandra J. Basile, et al. v. H&R Block, Inc.,
et al., April Term 1992 Civil Action No. 3246 in the Court of
Common Pleas, First Judicial District Court of Pennsylvania,
Philadelphia County, instituted on April 23, 1993.
The plaintiffs allege inadequate disclosures with respect to the
RAL product and assert claims for violation of consumer protection
statutes, negligent misrepresentation, breach of fiduciary duty,
common law fraud, usury, and violation of the Truth In Lending
Act. Plaintiffs seek unspecified actual and punitive damages,
injunctive relief, attorneys' fees and costs.
A Pennsylvania class was certified, but later decertified by the
trial court in December 2003. The trial court's decertification
decision is currently on appeal.
No updates were reported in the company's Sept. 3, 2010, Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarter ended July 31, 2010.
H&R Block Inc. -- http://www.hrblock.com/-- is one of the world's
largest tax services providers, having prepared more than 550
million tax returns worldwide since 1955. In fiscal 2010, H&R
Block had annual revenues of $3.9 billion and prepared more than
23 million tax returns worldwide, utilizing more than 100,000
highly trained tax professionals. The company provides tax return
preparation services in person, through H&R Block At Home(TM)
online and desktop software products, and through other channels.
The company is also one of the leading providers of business
services through RSM McGladrey.
H&R BLOCK: Awaits Ruling on Certification Motion in "Marshall"
--------------------------------------------------------------
H&R Block, Inc., awaits the ruling on the plaintiffs' new motion
for class certification seeking certification of an 11-state
class, according to the company's Sept. 3, 2010, Form 10-Q filing
with the U.S. Securities and Exchange Commission for the quarter
ended July 31, 2010.
The company is a defendant in lawsuits regarding its Peace of Mind
program, under which its applicable tax return preparation
subsidiary assumes liability for additional tax assessments
attributable to tax return preparation error.
The matter Lorie J. Marshall, et al. v. H&R Block Tax Services,
Inc., et al., Case No. 08-CV-591 in the U.S. District Court for
the Southern District of Illinois, is a putative class action case
originally filed in the Circuit Court of Madison County, Illinois
on January 18, 2002.
The plaintiffs allege that the sale of POM guarantees constitutes:
(1) statutory fraud by selling insurance without a license,
(2) an unfair trade practice, by omission and by "cramming"
(i.e., charging customers for the guarantee even though
they did not request it or want it), and
(3) a breach of fiduciary duty.
The plaintiffs seek unspecified damages, injunctive relief,
attorneys' fees and costs. The Madison County court ultimately
certified a class consisting of all persons residing in 13 states
who paid a separate fee for POM from Jan. 1, 1997 to the date of a
final judgment from the court. The company subsequently removed
the case to federal court in the Southern District of Illinois,
where it is now pending.
In November 2009, the federal court issued an order vacating the
state court's class certification ruling and allowing plaintiffs
time to file a renewed motion for class certification under the
federal rules. Plaintiffs filed a new motion for class
certification seeking certification of an 11-state class.
Oral argument on plaintiffs' motion occurred in April 2010 and the
parties are awaiting a ruling. A trial date has been set for
November 2010.
H&R Block Inc. -- http://www.hrblock.com/-- is one of the world's
largest tax services providers, having prepared more than 550
million tax returns worldwide since 1955. In fiscal 2010, H&R
Block had annual revenues of $3.9 billion and prepared more than
23 million tax returns worldwide, utilizing more than 100,000
highly trained tax professionals. The company provides tax return
preparation services in person, through H&R Block At Home(TM)
online and desktop software products, and through other channels.
The company is also one of the leading providers of business
services through RSM McGladrey.
H&R BLOCK: Continues to Defend "Soliz" Suit in Texas
----------------------------------------------------
H&R Block, Inc., defends the matter Desiri L. Soliz v. H&R Block,
et al. (Cause No. 03-032-D), pending in the District Court of
Kleberg County, Texas.
The company is a defendant in lawsuits regarding its Peace of Mind
program, under which its applicable tax return preparation
subsidiary assumes liability for additional tax assessments
attributable to tax return preparation error.
One is a putative class action pending against the company in
Texas that involves the POM guarantee. This case, styled Desiri
L. Soliz v. H&R Block, et al. (Cause No. 03-032-D), was filed on
Jan. 23, 2003 in the District Court of Kleberg County, Texas.
This case involves the same plaintiffs' attorneys that are
involved in the matter Lorie J. Marshall, et al. v. H&R Block Tax
Services, Inc., et al., in Illinois and contains allegations
similar to those in the Marshall litigation.
The plaintiff seeks actual and treble damages, equitable relief,
attorneys' fees and costs. No class has been certified in this
case.
No updates were reported in the company's Sept. 3, 2010, Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarter ended July 31, 2010.
H&R Block Inc. -- http://www.hrblock.com/-- is one of the world's
largest tax services providers, having prepared more than 550
million tax returns worldwide since 1955. In fiscal 2010, H&R
Block had annual revenues of $3.9 billion and prepared more than
23 million tax returns worldwide, utilizing more than 100,000
highly trained tax professionals. The company provides tax return
preparation services in person, through H&R Block At Home(TM)
online and desktop software products, and through other channels.
The company is also one of the leading providers of business
services through RSM McGladrey.
H&R BLOCK: RSM Defends Do Right's Suit in California
----------------------------------------------------
RSM McGladrey continues to defend the matter Do Right's Plant
Growers, et al. v. RSM EquiCo, Inc., et al., pending in the
California Superior Court, Orange County, according to H&R Block
Inc.'s Sept. 3, 2010, Form 10-Q filing with the U.S. Securities
and Exchange Commission for the quarter ended July 31, 2010.
RSM EquiCo, its parent and certain of its subsidiaries and
affiliates, are parties to a class action filed on July 11, 2006
and styled Do Right's Plant Growers, et al. v. RSM EquiCo, Inc.,
et al., Case No. 06 CC00137, in the California Superior Court,
Orange County. The complaint contains allegations relating to
business valuation services provided by RSM EquiCo, including
allegations of fraud, negligent misrepresentation, breach of
contract, breach of implied covenant of good faith and fair
dealing, breach of fiduciary duty and unfair competition.
Plaintiffs seek unspecified actual and punitive damages, in
addition to pre-judgment interest and attorneys' fees.
On March 17, 2009, the court granted plaintiffs' motion for class
certification on all claims. The defendants filed two requests
for interlocutory review of the decision, the last of which was
denied by the Supreme Court of California on Sept. 30, 2009. A
trial date has been set for January 2011.
The certified class consists of RSM EquiCo's U.S. clients who
signed platform agreements and for whom RSM EquiCo did not
ultimately market their business for sale. The fees paid to RSM
EquiCo in connection with these agreements total approximately
$185 million, a number which substantially exceeds the equity of
RSM EquiCo.
The company says that the amount claimed in this action is
substantial and could have a material adverse impact on its
consolidated results of operations.
H&R Block Inc. -- http://www.hrblock.com/-- is one of the world's
largest tax services providers, having prepared more than 550
million tax returns worldwide since 1955. In fiscal 2010, H&R
Block had annual revenues of $3.9 billion and prepared more than
23 million tax returns worldwide, utilizing more than 100,000
highly trained tax professionals. The company provides tax return
preparation services in person, through H&R Block At Home(TM)
online and desktop software products, and through other channels.
The company is also one of the leading providers of business
services through RSM McGladrey.
H&R BLOCK: Continues to Defend Several Wage and Hour Lawsuits
-------------------------------------------------------------
H&R Block Inc. continues to defend several wage and hour class
action lawsuits throughout the U.S.
The company has been named in several wage and hour class action
lawsuits throughout the country, respectively styled:
1. Alice Williams v. H&R Block Enterprises LLC,
Case No.RG08366506 (Superior Court of California, County
of Alameda, filed Jan. 17, 2008);
2. Arabella Lemus v. H&R Block Enterprises LLC, et al.,
Case No. CGC-09-489251 (U.S. District Court, Northern
District of California, filed June 9, 2009);
3. Delana Ugas v. H&R Block Enterprises LLC, et al.,
Case No. BC417700 (U.S. District Court, Central District
of California, filed July 13, 2009);
4. Barbara Petroski v. H&R Block Eastern Enterprises, Inc.,
et al., Case No. 10-CV-00075 (U.S. District Court,
Western District of Missouri, filed Jan. 25, 2010);
5. Lance Hom v. H&R Block Enterprises LLC, et al.,
Case No. 10CV0476 H (U.S. District Court, Southern
District of California, filed March 4, 2010);
6. Stacy Oyer v. H&R Block Eastern Enterprises, Inc.,
et al., Case No. 10-CV-00387-WMS (U.S. District Court,
Western District of New York, filed May 10, 2010); and
7. Li Dong Ma v. RSM McGladrey TBS, LLC, et al.,
Case No. C-08-01729 JF (U.S. District Court, Northern
District of California, filed Feb. 28, 2008).
These cases involve a variety of legal theories and allegations
including, among other things, failure to compensate employees for
all hours worked; failure to provide employees with meal periods;
failure to provide itemized wage statements; failure to pay wages
due upon termination; failure to compensate for mandatory off-
season training; and/or misclassification of non-exempt employees.
The plaintiffs seek actual damages, in addition to statutory
penalties, pre-judgment interest and attorneys' fees.
No updates or additional disclosures were reported in the
company's Sept. 3, 2010, Form 10-Q filing with the U.S. Securities
and Exchange Commission for the quarter ended July 31, 2010.
The company says that the amount claimed in this action is
substantial and could have a material adverse impact on its
consolidated results of operations.
H&R Block Inc. -- http://www.hrblock.com/-- is one of the world's
largest tax services providers, having prepared more than 550
million tax returns worldwide since 1955. In fiscal 2010, H&R
Block had annual revenues of $3.9 billion and prepared more than
23 million tax returns worldwide, utilizing more than 100,000
highly trained tax professionals. The company provides tax return
preparation services in person, through H&R Block At Home(TM)
online and desktop software products, and through other channels.
The company is also one of the leading providers of business
services through RSM McGladrey.
HEWITT ASSOCIATES: Has MOU to Settle Suits Over Aon Merger
----------------------------------------------------------
Hewitt Associates, Inc. has entered into a memorandum of
understanding to settle putative class actions arising out of its
planned merger with Aon Corporation, according to the company's
Sept. 3, 2010, Form 8-K filing with the U.S. Securities and
Exchange Commission.
On July 11, 2010, Hewitt entered into an Agreement and Plan of
Merger with Aon, pursuant to which Hewitt agreed to merge with a
wholly owned subsidiary of Aon. On Aug. 17, 2010, Aon filed with
the SEC a definitive Joint Proxy Statement/Prospectus of Hewitt
and Aon in connection with the proposed Merger.
Following the announcement of the Merger Agreement, five putative
class action complaints were filed against Hewitt, the Hewitt
board of directors, Aon, and/or Alps Merger LLC in Delaware
Chancery Court, the U.S. District Court for the Northern District
of Illinois, Cook County, Illinois Chancery Court and the Circuit
Court of the Nineteenth Judicial Circuit in Lake County, Illinois.
These complaints alleged generally that defendants breached their
fiduciary duties, or aided and abetted others' breaches of
fiduciary duties, in connection with the Merger by, among other
things, authorizing the transaction for what plaintiffs claimed to
be inadequate consideration and pursuant to what plaintiffs
claimed to be an inadequate process. The relief sought by the
various Actions included, among other things, enjoining the
proposed Merger, or, to the extent the Merger had already been
implemented, rescinding it and/or directing defendants to account
for damages sustained by the putative class.
On Aug. 12, 2010, plaintiffs in the two Cook County, Illinois,
Chancery Court actions filed a motion for consolidation
(subsequently corrected on Aug. 13, 2010), which was granted on
Aug. 19, 2010. Plaintiffs in the remaining three actions
voluntarily agreed to conduct a single preliminary injunction
proceeding in the consolidated Cook County action with all
plaintiffs participating and proceeding with expedited discovery
in a coordinated fashion.
Subsequently, Hewitt, the other defendants in the Actions, and the
plaintiffs entered into a memorandum of understanding, dated as of
Sept. 3, 2010 (the "Memorandum of Understanding"), regarding the
settlement of the Actions. In connection with the settlement
contemplated by the Memorandum of Understanding, the parties
agreed that Hewitt and Aon would make certain disclosures to their
stockholders relating to the proposed Merger, in addition to the
information contained in the Joint Proxy Statement/Prospectus.
The Memorandum of Understanding also contemplates that the parties
will seek to enter into and present to the Circuit Court of Cook
County, Illinois a stipulation of settlement.
Hewitt Associates Inc. -- http://www.hewitt.com/-- provides
leading organizations around the world with expert human resources
consulting and outsourcing solutions to help them anticipate and
solve their most complex benefits, talent, and related financial
challenges. Hewitt works with companies to design, implement,
communicate, and administer a wide range of human resources,
retirement, investment management, health care, compensation, and
talent management strategies. With a history of exceptional
client service since 1940, Hewitt has offices in more than 30
countries and employs approximately 23,000 associates who are
helping make the world a better place to work.
KKR & CO: Shareholders' Plea to Proceed With Discovery Pending
--------------------------------------------------------------
A motion to proceed with the second round of discovery in an
action filed by a purported class of shareholders against KKR &
Co., L.P., is pending before the U.S. District Court for the
District of Massachusetts, the company said in its Form 10-Q for
the quarter ended June 30, 2010, filed with the U.S. Securities
and Exchange Commission.
In December 2007, KKR, along with 15 other private equity firms
and investment banks, were named as defendants in a purported
class action complaint filed in the United States District Court
for the District of Massachusetts by shareholders in certain
public companies acquired by private equity firms since 2003. In
August 2008, KKR, along with 16 other private equity firms and
investment banks, were named as defendants in a purported
consolidated amended class action complaint. The suit alleges
that from mid-2003 defendants have violated antitrust laws by
allegedly conspiring to rig bids, restrict the supply of private
equity financing, fix the prices for target companies at
artificially low levels, and divide up an alleged market for
private equity services for leveraged buyouts. The complaint seeks
injunctive relief on behalf of all persons who sold securities to
any of the defendants in leveraged buyout transactions and
specifically challenges nine transactions. The amended complaint
also includes five purported sub-classes of plaintiffs seeking
unspecified monetary damages and/or restitution with respect to
five of the nine challenged transactions.
The first stage of discovery concluded on or about April 15, 2010,
and on April 26, 2010, plaintiffs filed a motion seeking an order
allowing plaintiffs to proceed to the second stage of discovery.
On July 2, 2010, KKR and the other named defendants filed
oppositions to plaintiffs' motion to proceed to the second phase
of discovery. Plaintiffs' motion is pending before the District
Court.
About KKR & Co.
Kohlberg Kravis Roberts & Co., L.P. -- http://www.kkr.com/--
assembles funds from institutional and wealthy investors and
profits from management fees and its direct interests.
KKR & CO: Oral Argument in Charter Litigation Postponed
-------------------------------------------------------
Oral argument in a class action lawsuit filed by the Charter
Township of Clinton Police and Fire Retirement System against KKR
& Co., L.P., is postponed, the company said in its Form 10-Q for
the quarter ended June 30, 2010, filed with the U.S. Securities
and Exchange Commission.
In August 2008, KKR Financial Holdings LLC, the members of KFN's
board of directors and certain of its current and former executive
officers, including certain of KKR's current and former personnel,
were named in a putative class action complaint filed by the
Charter Township of Clinton Police and Fire Retirement System in
the United States District Court for the Southern District of New
York.
In March 2009, the lead plaintiff filed an amended complaint,
which deleted as defendants the members of KFN's board of
directors and named as individual defendants only KFN's former
chief executive officer, KFN's former chief operating officer, and
KFN's current chief financial officer. The amended complaint
alleges that KFN's April 2007 registration statement and
prospectus and the financial statements incorporated therein
contained material omissions in violation of Section 11 of the
Securities Act regarding the risks and potential losses associated
with KFN's real estate-related assets, KFN's ability to finance
its real estate-related assets, and the adequacy of KFN's loss
reserves for its real estate-related assets. The amended
complaint further alleges that, pursuant to Section 15 of the
Securities Act, the KFN Individual Defendants have legal
responsibility for the alleged Section 11 violation. The amended
complaint seeks judgment in favor of the lead plaintiff and the
putative class for unspecified damages allegedly sustained as a
result of the KFN Defendants' alleged misconduct, costs and
expenses incurred by the lead plaintiff in the action, rescission
or a rescissory measure of damages, and equitable or injunctive
relief.
In April 2009, the KFN Defendants filed a motion to dismiss the
amended complaint for failure to state a claim under the
Securities Act. Oral argument on Defendants' motion to dismiss
previously scheduled for July 7, 2010, has been postponed due to
the fact that the judge overseeing the Charter Litigation
unexpectedly took medical leave. To date, the oral argument has
not been rescheduled.
About KKR & Co.
Kohlberg Kravis Roberts & Co., L.P. -- http://www.kkr.com/--
assembles funds from institutional and wealthy investors and
profits from management fees and its direct interests.
MATRIXX INITIATIVES: Court Denies Settlement of Zicam Class Suits
-----------------------------------------------------------------
Drug Industry Daily reports a U.S. district court judge in Arizona
has declined to approve Matrixx Initiatives' proposed settlement
for a series of class action lawsuits concerning its recalled OTC
cold remedy Zicam. The decision follows the company's attempt to
include claims from another lawsuit filed in an Illinois federal
court in the settlement. A panel consolidating the suits last
year found the Illinois suit insufficiently similar to the other
cases. Allowing its inclusion in the settlement would violate
that order, Judge Frederick Martone ruled.
MEMC ELECTRONIC: Appeal on Dismissal of Patel Suit Ongoing
----------------------------------------------------------
An appeal of the dismissal of a consolidated class action lawsuit
filed against MEMC Electronic Materials Inc. and its former chief
executive remains pending, according to the company's Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarter ended June 30, 2010.
On September 26, 2008, a putative class action lawsuit was filed
in the U.S. District Court for the Eastern District of Missouri by
plaintiff Minneapolis Firefighters' Relief Association asserting
claims against MEMC and Nabeel Gareeb, MEMC's former Chief
Executive Officer.
On October 10, 2008, a substantially similar putative class action
lawsuit was filed by plaintiff Donald Jameson against MEMC, Mr.
Gareeb and Ken Hannah, MEMC's former Chief Financial Officer and
currently MEMC's Executive Vice President and President-Solar
Materials. These cases purportedly are brought on behalf of all
persons who acquired shares of MEMC's common stock between June
13, 2008 and July 23, 2008, inclusive.
Both complaints allege that, during the Class Period, MEMC failed
to disclose certain material facts regarding MEMC's operations and
performance, which had the effect of artificially inflating MEMC's
stock price in violation of Section 10(b) of the Securities
Exchange Act of 1934. Plaintiffs further allege that Messrs.
Gareeb and Hannah are subject to liability under Section 20(a) of
the Act as control persons of MEMC. Plaintiffs seek certification
of the putative class, unspecified compensatory damages, interest
and costs, as well as ancillary relief.
On December 12, 2008, these actions were consolidated, and the
Court appointed Mahendra A. Patel as lead plaintiff. Plaintiff
filed a consolidated amended complaint on February 23, 2009.
Defendants filed a motion to dismiss the consolidated amended
complaint, which was fully briefed by the parties by June 24,
2009.
On March 8, 2010, the Court dismissed the consolidated class
action complaint with prejudice.
On March 31, 2010, plaintiff filed a notice of appeal to the
United States Court of Appeals for the Eighth Circuit. On
June 15, 2010, plaintiff filed his appellant brief. On July 15,
2010, defendants filed their appellee brief. Plaintiff filed a
reply brief on July 29, 2010.
About MMEC Electronics
MEMC Electronic Materials Inc. -- http://www.memc.com/-- is
engaged into designing, manufacturing, and selling of silicon
wafers. Its customers include major semiconductor device and
solar cell (device) manufacturers. It provides wafer in sizes
ranging from 100 millimeters (4 inch) to 300 millimeters (12
inch). The company also sells intermediate products, such as
polysilicon, silane gas, ingots and scrap wafers to semiconductor
device and equipment makers, solar cell and module manufacturers,
flat panel and other industries. The company offers variety of
wafers varying in size, surface features, composition, purity
levels, crystal properties and electrical properties. In
November 2009, the company completed the acquisition of Sun
Edison LLC.
MEMC ELECTRONIC: Motion to Dismiss "Jones" Suit Still Pending
-------------------------------------------------------------
MEMC Electronic Materials Inc.'s motion for reconsideration of an
order denying its request to dismiss an amended class action
complaint alleging violations of the Employee Retirement Income
Security Act remains pending, according to the company's Form
10-Q filing with the U.S. Securities and Exchange Commission for
the quarter ended June 30, 2010.
On December 26, 2008, a putative class action lawsuit was filed in
the U.S. District Court for the Eastern District of Missouri by
plaintiff Jerry Jones purportedly on behalf of all participants in
and beneficiaries of MEMC's 401(k) Savings Plan between September
4, 2007 and December 26, 2008, inclusive.
The complaint asserted claims against MEMC and certain of its
directors, employees and other unnamed fiduciaries of the Plan.
The complaint alleges that the defendants breached certain
fiduciary duties owed under the Employee Retirement Income
Security Act, generally asserting that the defendants failed to
make full disclosure to the Plan's participants of the risks of
investing in MEMC's stock and that the Company's stock should not
have been made available as an investment alternative in the Plan.
The misstatements alleged in the complaint significantly overlap
with the misstatements alleged in a separate federal securities
class action.
On June 1, 2009, an amended class action complaint was filed by
Mr. Jones and another purported participant of the Plan, Manuel
Acosta, which raises substantially the same claims and is based on
substantially the same allegations as the original complaint.
However, the amended complaint changes the period of time covered
by the action, purporting to be brought on behalf of beneficiaries
of and participants in the Plan from June 13, 2008 through the
present, inclusive. The amended complaint seeks unspecified
monetary damages, including losses the participants and
beneficiaries of the Plan allegedly experienced due to their
investment through the Plan in MEMC's stock, equitable relief and
an award of attorney's fees. No class has been certified and
discovery has not begun.
The Company and the named directors and employees filed a motion
to dismiss the complaint, which was fully briefed by the parties
as of October 9, 2009. The parties each subsequently filed notices
of supplemental authority and corresponding responses.
On March 17, 2010, the court denied the motion to dismiss. On
April 14, 2010, defendants filed a motion for reconsideration or,
in the alternative, certification for interlocutory appeal. On
May 26, 2010, plaintiffs filed their response to defendants'
motion, and on June 16, 2010, defendants filed their reply. On
July 14, 2010, plaintiffs filed a notice of supplemental authority
and on July 23, 2010, defendants filed a response to the notice.
The Company and the named directors and employees intend to
vigorously defend themselves against these claims.
About MMEC Electronics
MEMC Electronic Materials Inc. -- http://www.memc.com/-- is
engaged into designing, manufacturing, and selling of silicon
wafers. Its customers include major semiconductor device and
solar cell (device) manufacturers. It provides wafer in sizes
ranging from 100 millimeters (4 inch) to 300 millimeters (12
inch). The company also sells intermediate products, such as
polysilicon, silane gas, ingots and scrap wafers to semiconductor
device and equipment makers, solar cell and module manufacturers,
flat panel and other industries. The company offers variety of
wafers varying in size, surface features, composition, purity
levels, crystal properties and electrical properties. In
November 2009, the company completed the acquisition of Sun
Edison LLC.
MERGE HEALTHCARE: Awaits Ruling on Progress' $5MM Fee Petition
--------------------------------------------------------------
Merge Healthcare Inc. disclosed in its Form 10-Q filed with the
U.S. Securities and Exchange Commission for the quarter ended June
30, 2010, that AMICAS Inc. is awaiting a court ruling on a $5
million fee petition filed by a class of Thoma Bravo LLC
shareholders.
In January, 2010, a purported stockholder class action complaint
was filed in the Superior Court of Suffolk County, Massachusetts
in connection with AMICAS' proposed acquisition by Thoma Bravo,
LLC, entitled Progress Associates, on behalf of itself and all
others similarly situated v. AMICAS, Inc., et al., Civil Action
No. 10-0174.
In March, 2010, because the Company had terminated the Thoma Bravo
Merger and agreed to be acquired by Merge Healthcare, the Court
dismissed the plaintiffs' claims as moot. Subsequently, counsel
to the plaintiffs filed an application for approximately $5
million of attorneys' fees for its work on this case, which fee
petition AMICAS has opposed. A court hearing on the fee petition
was held on August 4, 2010, but the court did not set a date for
the issuance of a ruling. AMICAS has retained litigation counsel,
has tendered defense of this matter to its appropriate insurers
and intends to continue to vigorously defend the fee petition.
About Merge Healthcare
Merge Healthcare Incorporated, (NASDAQ: MRGE), headquartered in
Milwaukee, Wisconsin, develops healthcare software solutions and
related services. The company focuses on solutions to the
diagnostic imaging community including Radiology Information
Systems (RIS) and Picture Archiving and Communications Systems
(PACS). Merge generated GAAP revenues of approximately $67
million for the twelve months ended December 31, 2009. Merrick
Ventures and affiliates currently own roughly 40% of Merge's
stock.
PENN NATIONAL: Arguments on Shareholders Suit Appeal Set for Oct.
-----------------------------------------------------------------
Penn National Gaming Inc., in its Form 10-Q filed with the U.S.
Securities and Exchange Commission for the quarter ended June 30,
2010, said the Fourth Circuit Court of Appeals will hear oral
arguments on an appeal of an order dismissing a class action
lawsuit against the Company in late October this year.
On July 16, 2008, the Company was served with a purported class
action lawsuit brought by plaintiffs seeking to represent a class
of shareholders who purchased shares of the Company's Common Stock
between March 20, 2008 and July 2, 2008. The lawsuit alleges that
the Company's disclosure practices relative to the proposed
transaction with Fortress Investment Group LLC and Centerbridge
Partners, L.P. and the eventual termination of that transaction
were misleading and deficient in violation of the Securities
Exchange Act of 1934.
The complaint, which seeks class certification and unspecified
damages, was filed in federal court in Maryland. The complaint was
amended, among other things, to add three new named plaintiffs and
to name Peter M. Carlino, Chairman and Chief Executive Officer,
and William J. Clifford, Senior Vice President and Chief Financial
Officer, as additional defendants. The Company filed a motion to
dismiss the complaint in November 2008, and the court granted the
motion and dismissed the complaint with prejudice. The plaintiffs
filed a motion for reconsideration, which was denied on October
21, 2009.
The plaintiffs have appealed the decision to the Fourth Circuit
Court of Appeals and oral arguments are scheduled to be heard in
late October of this year.
About Penn National
Penn National Gaming, Inc. -- http://www.pngaming.com/-- is a
diversified, multi-jurisdictional owner and manager of gaming and
pari-mutuel properties. The company owns or manages 19
facilities in 15 jurisdictions, including Colorado, Florida,
Illinois, Indiana, Iowa, Louisiana, Maine, Mississippi, Missouri,
New Jersey, New Mexico, Ohio, Pennsylvania, West Virginia, and
Ontario. The company's properties include Charles Town
Entertainment Complex, Hollywood Casino Lawrenceburg, Hollywood
Casino at Penn National Race Course, Hollywood Casino Aurora,
Empress Casino Hotel, Argosy Casino Riverside, Hollywood Casino
Baton Rouge, Argosy Casino Al, Hollywood Casino Tunica, Hollywood
Casino Bay St. Louis, Argosy Casino Sioux City, Boomtown Biloxi,
Hollywood Slots Hotel and Raceway, Bullwhackers, Black Gold
Casino at Zia Park, Raceway Park, Freehold Raceway, Sanford-
Orlando Kennel Club, Off-track Wagering Facilities, Account
Wagering/Internet Wagering and Casino Rama.
PROSPER MARKETPLACE: Loan Note Purchasers' Class Suit Ongoing
-------------------------------------------------------------
Prosper Marketplace Inc. said in its Form 10-Q for the quarter
ended June 30, 2010, filed with the U.S. Securities and Exchange
Commission that the class suits filed on behalf of loan note
purchasers are ongoing and are in their preliminary stages.
On November 26, 2008, plaintiffs Christian Hellum, William
Barnwell and David Booth, individually and on behalf of all other
plaintiffs similarly situated, filed a class action lawsuit
against the Company, certain of the Company's executive officers
and its directors in the Superior Court of California, County of
San Francisco, California. The suit was brought on behalf of all
loan note purchasers in the Company's online lending platform from
January 1, 2006, through October 14, 2008. The lawsuit alleges
that Prosper offered and sold unqualified and unregistered
securities in violation of the California and federal securities
laws. The lawsuit seeks class certification, damages and the
right of rescission against Prosper and the other named
defendants, as well as treble damages against Prosper and the
award of attorneys' fees, experts' fees and costs, and pre-
judgment and post-judgment interest.
Some of the individual defendants filed a demurrer to the First
Amended Complaint, which was heard on June 11, 2009, and sustained
by the court with leave to amend until July 10, 2009. The
plaintiffs filed a Second Amended Complaint on July 10, 2009, to
which the same individual defendants demurred. On
September 15, 2009, this demurrer was sustained by the court
without leave to amend.
Prosper's insurance carrier with respect to the class action
lawsuit, Greenwich Insurance Company has denied coverage. On
August 21, 2009, Prosper filed suit against Greenwich in the
Superior Court of California, County of San Francisco, California.
The lawsuit seeks a declaration that Prosper is entitled to
coverage under its policy with Greenwich for losses arising out of
the class action lawsuit as well as damages and the award of
attorneys' fees and pre-judgment and post-judgment interest.
The Company said it intends to vigorously defend the class-action
lawsuit and vigorously prosecute the suit against Greenwich.
As of June 30, 2010, the lawsuits are in their preliminary stages
and their probable outcomes cannot presently be determined, nor
can the amount of damages or other costs that might be borne by
Prosper be estimated.
About Prosper Marketplace
Prosper Marketplace, Inc. -- http://www.prosper.com/-- is an
online marketplace for person-to-person lending. Prosper's
Web site provides an online marketplace for loans where people
list and bid on loans with interest rates of return determined
through Prosper's online auction platform.
REACHLOCAL INC: Wage & Hour Violations Suit Pending in Calif.
-------------------------------------------------------------
ReachLocal Inc. continues to face a class action lawsuit alleging
wage and hour violations in California, the company said in its
Form 10-Q for the quarter ended June 30, 2010, filed with the U.S.
Securities and Exchange Commission.
On March 1, 2010, a class action lawsuit was filed by two of the
Company's former employees in California Superior Court in Los
Angeles, California. The complaint alleges wage and hour
violations in a Fair Labor Standards Act collective action and a
California class action. The classes for each action have not been
certified and potentially consist of approximately 1,000 persons
for the federal collective action and approximately 250 persons
for the California class action. The case is at an early stage and
the Company has not yet determined the amount of liability, if
any, that may result from the lawsuit. At this time, however,
management does not believe that this litigation will have a
material adverse impact on the company.
ReachLocal, Inc. (ReachLocal) offers online marketing and
reporting solutions, including search engine marketing, display
advertising, remarketing and online marketing analytics, each
targeted to the small and medium-sized businesses (SMB) market.
The Company delivers these solutions to SMBs through a combination
of it RL Platform and its direct, feet-on-the-street sales force
of Internet Marketing Consultants (IMCs), and select third-party
agencies and resellers. The Company uses its RL Platform to create
advertising campaigns for SMBs to target potential customers in
their geographic area, optimize those campaigns in real time and
track tangible results.
T-MOBILE: Kennett City Officials Say Suit Settlement Is Near
------------------------------------------------------------
Lecia Forester at Daily Dunklin Democrat reports since Sept. 1,
2005, Kennett (a city in Dunklin County, Missouri) has been
engaged in a class action suit against T-Mobile and a number of
other wireless carriers including Verizon, AT&T Mobility, Sprint
Nextel, and AT&T/SBC Communications. All the carriers except T-
Mobile has since settled, but according to city officials, payment
is forthcoming from T-Mobile in the near future. In a recent
proposal to the city, T-Mobile has agreed to pay the city $472.02
in back taxes, owed to the city since 2005.
During last month's council meeting, aldermen voted on and
approved an ordinance to accept payment from T-Mobile.
Essentially, what this case is about and how it got started is due
to one simple thing, according to local officials -- the wireless
carriers thought that since they weren't landlines, they should be
exempt from paying any franchise taxes.
It has been the contention of many towns in Missouri that wireless
phone companies should be expected to pay the same business
licenses and taxes as the landline telephone companies.
The wireless companies in turn did not agree with this viewpoint.
They contend that the services that the companies offer and the
facilities that are used aren't subject to municipal taxes since
they refer to themselves as "commercial mobile radio services."
Lawyers from both sides have come to terms and agree that
settlement serves the best interests of the parties involved. Both
sides have entered into a settlement agreement concerning this
matter. The St. Louis County Circuit Court has given preliminary
approval for the settlement.
Although the telephone companies have agreed to pay any back taxes
owed and any future taxes incurred, they do not admit to the fact
that their services are considered "telephone" nor do they admit
that they owe any back taxes.
Any towns in Missouri that have established a "business license
tax," on or before June 28, 2010, or the wireless companies have
provided services through their facilities and earned revenue are
included in this settlement class action suit and are entitled to
receiving payment of any back taxes and payment of any future
taxes, according to officials.
The following reflects back taxes paid to the city since February
of 2008. However, these amounts reflect tax money owed to the city
since Sept. 1, 2005. The following wireless companies listed have
a larger customer base than T-Mobile and since the money owed is
based on gross receipts, the amount would be larger. According to
officials, T-Mobile does not have as large a customer base in the
city. Kennett has settled with the following wireless companies
for the amounts owed in back taxes.
* Verizon -- $25,688.85
* AT&T Mobility -- $313,005.40
* Sprint Nextel -- $11,006.18
* AT&T/SBC Communications -- $192,496.62
T-Mobile has been the only outstanding wireless company since
Dec. 29, 2009.
According to City Clerk Brenda Privett, the funds previously
received from the carriers listed were applied to the city's
General Revenue Fund upon receipt, and have already been spent.
Privett noted that had it not been for the funds sourced through
the lawsuit, the City of Kennett would be in much worse conditions
that it presently is in terms of money available within its
budget. Privett also added that the funds spent covered expenses
such as monthly bills, and various department salaries, in
addition to other miscellaneous expenses.
To determine how much back taxes a city is entitled to is
determined by gross receipts from the beginning of service through
Dec. 31, 2007. If it has been decided that a city has a Business
License tax , it is entitled to at least 27 percent of that tax
based on gross receipts.
The wireless companies agreed to pay to the city any money due
from the Business License Tax, encompassing tax periods and those
partial tax periods that began on or after Jan, 1, 2008.
Taxes established on revenue from "commercial mobile radio
services" (CMRS) are subject to being taxed by the city if a
telephone company has a local address or a local business address
within the city limits.
This is considered to be a "sourcing rule" and is mandated by the
Mobile Telecommunications Sourcing Act. Due to this sourcing act ,
telephone companies will pay taxes on revenue from the provision
of Telecommunications Service.
After the court enters in the final order for dismissal, a city
that is involved in the class action suit can expect to receive
its money within 30 days, However, to receive this money, the
dismissal order needs to be finalized by the Court.
VERIFONE SYSTEMS: Motion to Dismiss Securities Suit Pending
-----------------------------------------------------------
VeriFone Systems, Inc.'s motion to dismiss a third amended
complaint remains pending before the U.S. District Court for
the Northern District of California, according to the company's
Sept. 3, 2010, Form 10-Q filing with the U.S. Securities and
Exchange Commission for the quarter ended July 31, 2010.
On or after Dec. 4, 2007, several securities class action claims
were filed against the company and certain of its officers, former
officers, and a former director. The lawsuits were consolidated
as In re VeriFone Holdings, Inc. Securities Litigation, C 07-6140
MHP.
The original actions were:
-- Eichenholtz v. VeriFone Holdings, Inc. et al.,
C 07-6140 MHP;
-- Lien v. VeriFone Holdings, Inc. et al., C 07-6195 JSW;
-- Vaughn et al. v. VeriFone Holdings, Inc. et al.,
C 07-6197 VRW (Plaintiffs voluntarily dismissed this
complaint on March 7, 2008);
-- Feldman et al. v. VeriFone Holdings, Inc. et al.,
C 07-6218 MMC;
-- Cerini v. VeriFone Holdings, Inc. et al., C 07-6228 SC;
-- Westend Capital Management LLC v. VeriFone Holdings,
Inc. et al., C 07-6237 MMC;
-- Hill v. VeriFone Holdings, Inc. et al., C 07-6238 MHP;
-- Offutt v. VeriFone Holdings, Inc. et al., C 07-6241 JSW;
-- Feitel v. VeriFone Holdings, Inc., et al., C 08-0118 CW.
On Aug. 22, 2008, the court appointed plaintiff National Elevator
Fund lead plaintiff and its attorneys lead counsel. Plaintiff
filed its consolidated amended class action complaint on Oct. 31,
2008, which asserts claims under the Securities Exchange Act
Sections 10(b), 20(a), and 20A and Securities and Exchange
Commission Rule 10b-5 for securities fraud and control person
liability against the company and certain of its current and
former officers and directors, based on allegations that the
company and the individual defendants made false or misleading
public statements regarding its business and operations during the
putative class periods and seeks unspecified monetary damages and
other relief.
The company filed a motion to dismiss on Dec. 31, 2008. The court
granted that motion on May 26, 2009, and dismissed the
consolidated amended class action complaint with leave to amend
within 30 days of the ruling. The proceedings were stayed pending
a mediation held in October 2009 at which time the parties failed
to reach a mutually agreeable settlement. Plaintiffs' first
amended complaint was filed on Dec. 3, 2009, followed by a second
amended complaint filed on Jan. 19, 2010.
The company filed a motion to dismiss the second amended complaint
and the hearing on that motion was held on May 17, 2010.
In July 2010, prior to any court ruling on our motion, plaintiffs
filed a motion for leave to file a third amended complaint on the
basis that they have newly discovered evidence. The company's
motion to dismiss the third amended complaint is currently due on
Nov. 5, 2010, and a hearing on the company's motion is set for
Feb. 28, 2011.
Although discovery has not yet commenced in this action, on
Nov. 20, 2009, plaintiffs filed a motion to partially lift the
Private Securities Litigation Reform Act discovery stay in order
to obtain documents produced by the company to the SEC in
connection with the SEC's investigation into the restatement of
our fiscal year 2007 interim financial statements. The company
filed its opposition to this motion in January 2010 and at a
hearing in February 2010 the court denied the plaintiffs' motion
to lift the discovery stay.
VeriFone Systems, Inc. -- http://www.verifone.com/-- is the
global leader in secure electronic payment solutions. VeriFone
provides expertise, solutions and services that add value to the
point of sale with merchant-operated, consumer-facing and self-
service payment systems for the financial, retail, hospitality,
petroleum, government and healthcare vertical markets. VeriFone
solutions are designed to meet the needs of merchants, processors
and acquirers in developed and emerging economies worldwide.
VERIFONE SYSTEMS: Israel Suit Remains Stayed
--------------------------------------------
A class action complaint against VeriFone Systems, Inc., in Israel
remains stayed pending resolution of the securities class action
in the U.S., according to the company's Sept. 3, 2010, Form 10-Q
filing with the U.S. Securities and Exchange Commission for the
quarter ended July 31, 2010.
On Jan. 27, 2008, a class action complaint was filed against the
company in the Central District Court in Tel Aviv, Israel on
behalf of purchasers of the company's stock on the Tel Aviv Stock
Exchange. The complaint seeks compensation for damages allegedly
incurred by the class of plaintiffs due to the publication of
erroneous financial reports.
The company filed a motion to stay the action, in light of the
proceedings already filed in the United States, on March 31, 2008.
A hearing on the motion was held on May 25, 2008. Further
briefing in support of the stay motion, specifically with regard
to the threshold issue of applicable law, was submitted on
June 24, 2008.
On Sept. 11, 2008, the Israeli District Court ruled in the
company's favor, holding that U.S. law would apply in determining
the company's liability. On Oct. 7, 2008, plaintiffs filed a
motion for leave to appeal the District Court's ruling to the
Israeli Supreme Court. The company's response to plaintiffs'
appeal motion was filed on Jan. 18, 2009.
The District Court has stayed its proceedings until the Supreme
Court rules on plaintiffs' motion for leave to appeal.
On Jan. 27, 2010, after a hearing before the Supreme Court, the
court dismissed the plaintiff's motion for leave to appeal and
addressed the case back to the District Court. The Supreme Court
instructed the District Court to rule whether the Israeli class
action should be stayed, under the assumption that the applicable
law is U.S. law.
Plaintiff subsequently filed an application for reconsideration of
the District Court's ruling that U.S. law is the applicable law.
Following a hearing on plaintiff's application, on April 12, 2010,
the parties agreed to stay the proceedings pending resolution of
the U.S. securities class action, without prejudice to plaintiff's
right to appeal the District Court's decision regarding the
applicable law to the Supreme Court.
Plaintiff has filed a motion with the Israeli Supreme Court for
leave to appeal the District Court's decision. No briefing
schedule or hearing date has been set for plaintiff's motion.
VeriFone Systems, Inc. -- http://www.verifone.com/-- is the
global leader in secure electronic payment solutions. VeriFone
provides expertise, solutions and services that add value to the
point of sale with merchant-operated, consumer-facing and self-
service payment systems for the financial, retail, hospitality,
petroleum, government and healthcare vertical markets. VeriFone
solutions are designed to meet the needs of merchants, processors
and acquirers in developed and emerging economies worldwide.
WAL-MART STORES: Plaintiffs' Response on Review Motion Due Oct. 25
------------------------------------------------------------------
Anne Constable, writing for The New Mexican, reports Wal-Mart
Stores last week asked the U.S. Supreme Court to reverse an
appeals court decision that a massive sex-discrimination case
against the company can proceed as a class action.
The case involves more than a million current and former female
employees of Wal-Mart and its warehouse membership arm, Sam's
Club. For the company, one of the world's biggest, a billion
dollars or more might be at stake.
And Dukes v Wal-Mart Stores, Inc., the largest employment
discrimination case in U.S. history, was started by two lawyers
right here in Santa Fe nearly a decade ago.
Former law partners Stephen Tinkler and Merit Bennett are still
key members of an elite legal team representing six named
plaintiffs, all of whom are California residents, in the high-
profile case.
Seven law firms are working on their response to the writ of
certiorari submitted by Wal-Mart requesting a review of the
decision last April by the U.S. Court of Appeals for the 9th
Circuit.
The Wal-Mart petition is a couple of hundred pages ("It's a book;
I'm not kidding," Mr. Tinkler said) and the plaintiffs' response,
due Oct. 25, is likely to be as long. The high court will decide
whether to grant cert during the term that begins next month. Four
votes are needed.
Mr. Bennett said last week that he didn't think the justices would
take the case and reverse the lower court.
But predicting what this court will do is chancy. When the case
was filed in 2001, there probably was not a prayer of having cert
granted, the lawyers say. But the court has changed dramatically
since then.
"Do I think there are four guys (on the court) who might want to
hear it; and can I think of three women who might not want to?"
Mr. Tinkler said. He added that he thought the 9th Circuit opinion
was "strong, not lightweight."
If the case gets sent back to the federal district court in San
Francisco for trial on the merits, the legal team is confident of
winning.
"We've taken a hundred depositions and (have accumulated) a couple
million documents," showing sex discrimination in compensation and
promotions by Wal-Mart, Mr. Tinkler said. "We have proof of all
this. This is not fluff."
A Treasure Trove of Information
After winning a major sexual harassment case against Sam's Club in
1996, Messrs. Bennett and Tinkler filed two more cases on behalf
of other female employees of the store. The second of those cases
yielded a treasure trove of information including a breakdown of
Wal-Mart's entire work force, including management, by gender. The
statistics showed that the hourly employees were between 65% and
70% female and the management was almost exactly the reverse.
The Santa Fe lawyers realized they had the makings of a class-
action suit and began looking for a plaintiff who had suffered the
harm they found in the documents from among the many individual
clients who contacted them.
In January 2000, Stephanie Odle called from Lubbock, Texas, saying
she had been denied the opportunity for promotion at a Sam's Club
and had been wrongly terminated. They realized that she typified
what they believed had been happening at Wal-Mart since the 1970s
and posed the idea to her of turning her case into a class action.
"She was game," Mr. Tinkler said.
But realizing that they would need more firepower to bring a
class-action suit against the retail giant, Mr. Tinkler said they
contacted a sexual harassment expert in Berkeley, Calif. who put
the Santa Fe attorneys in touch with Brad Seligman, an employment
lawyer who had retired from private practice to create The Impact
Fund, a nonprofit legal firm that advises other lawyers on class
actions.
In March 2000, the Santa Fe lawyers met with Mr. Seligman, who
immediately concluded, "We got something here," and over the
following months they began assembling the legal team. In addition
to Messrs. Tinkler and Bennett (who now have their own practices)
and The Impact Fund, the team includes lawyers from Davis, Cowell
& Bowe, a San Francisco firm representing workers and labor
organizations; attorneys from Cohen Milstein, a plaintiffs' class-
action law firm in Washington, D.C.; a Baltimore nonprofit called
Public Justice; and Equal Rights Advocates, a nonprofit legal
organization based in San Francisco.
The team created one Web site where current and former employees
of the company could contact them and another Web site just for
storing documents.
The lawyers also realized that from a legal point of view, their
best shot at a class action would be in the 9th Circuit based in
San Francisco, rather than the 5th, which is in Texas, where Ms.
Odle had been employed.
In June 2001 they filed the lawsuit, with Mr. Seligman as lead
attorney and the Cohen Milstein firm administering the case.
Ms. Odle was replaced by Betty Dukes of California as lead
plaintiff when the district court in California said only
California residents could be named plaintiffs.
Messrs. Tinkler and Bennett, along with the other lawyers,
traveled around the country taking, and defending, depositions,
helping formulate the legal strategy and appearing in court for
various hearings.
For more than a decade the Santa Fe lawyers have worked the case
without any compensation ("only a smile on my face," Mr. Bennett
said) -- although the reward in the end could be handsome.
Actually, "The way Merit and I look at it, it's been more than 14
years because we had the idea in 1997 and started actively pursing
it in 1998," Mr. Tinkler said.
'The short end of the stick'
Wal-Mart has repeatedly denied the underlying charges, claiming
that if there are problems of discrimination against women, they
only apply to specific stores and do not result from company
policy. In a news release earlier this year the company said that
the claims are not "representative of the experiences of our
female associates."
But Mr. Bennett, who has taken depositions from women in Montana,
Missouri, Alabama, Texas and other places, said that Wal-Mart is a
top-down, penny-pinching company that even controls the
temperature in all its stores from its headquarters in
Bentonville, Ark.
"Wal-Mart is trying to say that this is a parochial thing, but
that simply wasn't true," he said.
He said the way promotions usually happened began with a "shoulder
tap." A manager would alert a male buddy to an opening. There was
no policy allowing women a fair chance to move up the ladder, he
said.
"And when it's all men at the top and the good old boys rule, that
means women get the short end of the stick."
If Wal-Mart loses the discrimination case, every woman who was
employed by the company since Dec. 1, 1998 might be eligible for
compensation.
At the moment, any woman who worked for the discount store from
June 21, 2001, to the present is automatically included in the
suit. The class also includes any woman who worked there prior to
that date going back to December 1998, so long as she was still
employed on June 21, 2001.
A woman who worked for the company from December 1998 through
June 20, 2001, is still part of the suit, but whether she is a
member of this class will be determined when the case gets back to
district court.
Mr. Bennett said the number might reach 2 million.
The lawyers are continuing to take information from female
employees while the case has been on appeal and, "We still to this
day hear stories of discrimination," Mr. Tinkler said.
Some things have indeed changed at the company as a result of the
lawsuit, he acknowledged. For example, the company now has a
management training application process. And about five years ago
it did a "huge pay adjustment for women" that brought them closer
to parity with men, he said.
Absent a decision on the merits of the case, that "feels good," he
said, but the intake rate suggests that "gender discrimination is
alive and well at Wal-Mart" and, "they have not eradicated the
deeply rooted problem of gender discrimination which has been
present in the company since its inception."
Just being a player in such a massive case has been rewarding,
according to Mr. Bennett. "To be part of (something) on this
scale, the average lawyer doesn't get to do it."
*********
S U B S C R I P T I O N I N F O R M A T I O N
Class Action Reporter is a daily newsletter, co-published by
Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland
USA. Gracele D. Canilao, Leah Felisilda, Rousel Elaine Fernandez,
Joy A. Agravante, Ronald Sy, Christopher Patalinghug, Frauline
Abangan and Peter A. Chapman, Editors.
Copyright 2010. All rights reserved. ISSN 1525-2272.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.
Information contained herein is obtained from sources believed to
be reliable, but is not guaranteed.
The CAR subscription rate is $575 for six months delivered via
e-mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance thereof
are $25 each. For subscription information, contact Christopher
Beard at 240/629-3300.
* * * End of Transmission * * *